PAYE Calculator 2025/26

How PAYE is calculated in South Africa

PAYE (Pay-As-You-Earn) is the income tax employers deduct from every employee's salary each pay period and pay over to SARS by the 7th of the following month. The calculation is set out in the SARS PAYE guide (PAYE-GEN-01-G01) and revised every February in the Budget Speech.

The 2025/26 SARS tax brackets

For the tax year ending 28 February 2026, the sliding scale applied to annual taxable income is:

• Up to R237,100 — 18%
• R237,101 – R370,500 — R42,678 + 26% of the amount over R237,100
• R370,501 – R512,800 — R77,362 + 31% of the amount over R370,500
• R512,801 – R673,000 — R121,475 + 36% of the amount over R512,800
• R673,001 – R857,900 — R179,147 + 39% of the amount over R673,000
• R857,901 – R1,817,000 — R251,258 + 41% of the amount over R857,900
• Above R1,817,000 — R644,489 + 45% of the amount over R1,817,000

Rebates and tax thresholds

Every taxpayer receives a primary rebate of R17,235. Employees aged 65 or older get an additional secondary rebate of R9,444, and those 75+ a further tertiary rebate of R3,145. This means you only start paying PAYE once your annual income exceeds R95,750 (under 65), R148,217 (65+) or R165,689 (75+).

Medical tax credits (Section 6A)

If you contribute to a registered medical aid, SARS gives you a monthly medical tax credit of R364 for the main member, R364 for the first dependant and R246 for every additional dependant. The credit reduces PAYE directly.

Step-by-step formula

1. Annualise your period earnings (monthly × 12, fortnightly × 26, weekly × 52).
2. Apply the SARS bracket to get annual tax before rebates.
3. Subtract your age-based rebates.
4. Subtract medical tax credits (annualised).
5. Divide by the number of pay periods to get PAYE per payslip.

Common mistakes

Employers often forget to include annual bonuses in the annualised figure, apply the wrong rebate for older employees, or forget medical credits when the employee pays the medical aid directly. Payroll Africa handles all of this automatically.