Helpful Information - What is South African PAYE?

Pay-As-You-Earn (PAYE) is a tax system used in South Africa to collect income tax from employees. For the 2025/2026 tax year (1 March 2025 – 28 February 2026), this means your employer deducts a portion of your salary each month based on the latest SARS tax tables to cover your income tax liability. This system simplifies tax payments by spreading them throughout the year instead of requiring a lump sum at year-end.

Your employer calculates your PAYE based on your salary and factors like age-based rebates, deducting it monthly and remitting it to the South African Revenue Service (SARS) on your behalf. The amount depends on your income and any applicable deductions or credits.

Besides PAYE, your employer may deduct other contributions, such as Skills Development Levy (SDL) and Unemployment Insurance Fund (UIF). SDL funds skills development programs, while UIF provides support if you lose your job, with a maximum contribution of R177.12 per month for 2025/2026.

If you’re self-employed, you must calculate and pay your own income tax to SARS, but employees benefit from the PAYE system handled by employers. For questions, consult your employer or SARS directly.

Read more on SARS's Website

As an employee in South Africa, paying income tax through the Pay-As-You-Earn (PAYE) system is mandatory. For the 2025/2026 tax year, PAYE applies if your annual income exceeds R95,750 (under 65), R148,217 (65-74), or R165,689 (75 and older). This system simplifies tax obligations by deducting a portion of your monthly salary to cover your income tax liability, based on your income and eligible deductions or credits.

Your employer calculates and deducts your PAYE each month, remitting it to the South African Revenue Service (SARS) on your behalf. Additional deductions may include Skills Development Levy (SDL) and Unemployment Insurance Fund (UIF) contributions.

Failing to pay PAYE can lead to penalties and legal action from SARS, so timely payment is essential to avoid fines. Keep track of your income and deductions to ensure accurate PAYE calculations.

For questions or concerns about PAYE, consult your employer or SARS. Paying taxes is both a legal duty and a contribution to South Africa’s development.

What to do if I owe SARS?