PAYE Calculator Guide: How to Calculate Your Salary Tax
Understanding PAYE deductions is essential for financial planning. This guide explains PAYE calculations, how it works, and how to calculate take-home salary.
Use our calculator: SA Tax Calculator
What Is PAYE?
PAYE (Pay As You Earn) is tax deducted monthly from your salary by your employer and paid to SARS.
Key Points:
- Monthly prepayment of annual tax
- Employer deducts and submits
- Based on annual tax tables
- Reconciled with annual return
- Appears on monthly payslip
2025 Tax Brackets: R237,100 (18%), R370,500 (26%), R512,800 (31%), R673,000 (36%), R857,900 (39%), R1,817,000 (41%), Above (45%)
Monthly Rebate: R1,436 (under 65), R2,223 (65-75), R2,485 (75+)
How to Calculate PAYE Manually
Step 1: Annualize salary (monthly × 12)
Step 2: Subtract deductions (retirement, medical aid)
Step 3: Apply tax tables
Step 4: Subtract rebate
Step 5: Divide by 12
Example: R40,000/month salary
- Annual: R480,000
- Deductions: R93,600
- Taxable: R386,400
- Tax before rebate: R80,978
- Less rebate: R17,235
- Annual tax: R63,743
- Monthly PAYE: R5,312
- Take-home: R34,688
Using PAYE Calculators
Best Calculator: Genius Insights SA Tax Calculator
Inputs:
- Monthly/annual salary
- Retirement contributions
- Medical aid
- Age bracket
Outputs:
- Monthly PAYE
- Annual tax
- Take-home pay
- Effective rate
- Tax breakdown
Common PAYE Scenarios
Entry Level (R15,000/month): PAYE R994, Take-home R14,006
Mid-Career (R40,000/month): PAYE R5,312, Take-home R34,688
Senior (R80,000/month): PAYE R21,274, Take-home R58,726
Executive (R150,000/month): PAYE R38,659, Take-home R111,341
Maximizing Take-Home Pay
1. Retirement Contributions: 27.5% of gross (max R350k) - reduces taxable income
2. Medical Aid Credits: R347/month per member
3. Claim Deductions: RA, travel, home office
4. Structure Benefits: Pre-tax better than cash
Example Impact:
- Salary R50,000/month
- Increase retirement 10% → 15%
- Additional contribution: R2,500/month
- Tax saved (31% bracket): R775/month
- Net cost: R1,725 for R2,500 retirement saving
Understanding Your Payslip
Income: Basic + Allowances + Overtime + Bonuses = Gross
Deductions: PAYE + UIF (1%, max R177) + Pension + Medical = Total Deductions
Net Pay: Gross - Deductions = Take-home
Common Allowances: Housing, travel, cellphone, car
Taxable vs Non-Taxable: Most allowances taxable; some have partial exemptions
Understanding PAYE empowers you to optimize take-home pay legally. Use calculators to model scenarios and maximize retirement contributions for tax benefits.
Key Takeaways:
- PAYE is monthly tax prepayment
- Primary rebate R1,436/month
- Retirement contributions reduce tax effectively
- Bonuses taxed at marginal rate
- File annual return for refunds
Calculate now: SA Tax Calculator
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