PAYE (Pay-As-You-Earn) is the income tax deducted from your salary by your employer and paid to SARS on your behalf. It’s calculated based on your annual taxable income using SARS tax brackets.

South Africa uses progressive tax brackets: 18% on income up to R237,100, then 26% up to R370,500, 31% up to R512,800, 36% up to R673,000, 39% up to R817,600, 41% up to R1,731,600, and 45% on income above that. The primary rebate is R17,235.

UIF contributions are 1% of remuneration from the employee and 1% from the employer, capped at the maximum earnings threshold (currently R17,712 per month). The total UIF contribution is therefore 2%.

A tax rebate reduces the amount of tax you owe. The primary rebate for 2025/2026 is R17,235. Taxpayers aged 65-74 receive an additional R9,444, and those 75+ receive an additional R3,145.

Cost to Company (CTC) is the total amount an employer spends on an employee, including salary, benefits, bonuses, employer UIF contributions, and any other perks. It’s usually higher than the gross salary.

Overtime pay is added to your regular income and taxed at your marginal rate. This means your overtime pay may push you into a higher tax bracket for that specific month, but the annual tax is calculated on your total annual income.

The tax threshold is the income level below which you pay no income tax. For 2025/2026: under 65 it’s R95,750, age 65-74 it’s R148,217, and age 75+ it’s R165,689.

Yes. Common tax-free amounts include: travel allowance (if substantiated), uniform allowance, tool allowance, and subsistence allowance. Retirement fund contributions up to 27.5% of remuneration (capped at R350,000) are also tax-deductible.