If you earn a salary in South Africa, a slice of it goes to SARS every month as PAYE — Pay-As-You-Earn. Your employer works it out, withholds it, and pays it over on your behalf. Here's exactly how that number is calculated for the 2026 tax year.
Step 1: Annualise your salary
PAYE is based on your yearly taxable income, even though it's deducted monthly. So the first thing your employer does is multiply your monthly package by 12 to estimate your annual income.
Step 2: Apply the SARS tax tables
South Africa uses a sliding scale — the more you earn, the higher the rate on each additional rand. For 2026:
- R0 – R237,100: 18%
- R237,101 – R370,500: R42,678 + 26% of the amount above R237,100
- R370,501 – R512,800: R77,362 + 31%
- R512,801 – R673,000: R121,475 + 36%
- R673,001 – R857,900: R179,147 + 39%
- R857,901 – R1,817,000: R251,258 + 41%
- Above R1,817,000: R644,489 + 45%
Step 3: Subtract your rebates
Everyone gets the primary rebate of R17,235. If you're 65 or older you get an extra R9,444, and 75+ adds another R3,145. This is why you only start paying PAYE once you earn more than about R95,750 a year (roughly R7,979 a month) if you're under 65.
Step 4: Medical aid and retirement
If you're on a medical scheme, you get a medical tax credit (R364 a month each for the first two members, R246 for each extra). Contributions to a pension or retirement annuity are deductible up to 27.5% of your income (capped at R350,000 a year), which lowers your taxable income.
Step 5: UIF
On top of PAYE, 1% of your salary goes to UIF (your employer pays another 1%), capped at a salary of R17,712 a month — so the most you'll pay is R177.12.
Work out your own take-home
Rather than do the maths by hand, use our free Salary Tax Calculator — enter your salary and it shows your PAYE, UIF and net take-home instantly.
If you're an employer, doing this for every staff member each month is exactly what 360books automates — PAYE, UIF, SDL, ETI and IRP5s, all built for South Africa.