PAYE Calculator 2026/27

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 2026/27 SARS tax brackets

For the tax year ending 28 February 2027, the sliding scale applied to annual taxable income is:

• Up to R245,100 — 18%
• R245,101 – R383,100 — R44,118 + 26% of the amount over R245,100
• R383,101 – R530,200 — R79,998 + 31% of the amount over R383,100
• R530,201 – R695,800 — R125,599 + 36% of the amount over R530,200
• R695,801 – R887,000 — R185,215 + 39% of the amount over R695,800
• R887,001 – R1,878,600 — R259,783 + 41% of the amount over R887,000
• Above R1,878,600 — R666,339 + 45% of the amount over R1,878,600

Rebates and tax thresholds

Every taxpayer receives a primary rebate of R17,820. Employees aged 65 or older get an additional secondary rebate of R9,765, and those 75+ a further tertiary rebate of R3,249. This means you only start paying PAYE once your annual income exceeds R99,000 (under 65), R153,250 (65+) or R171,300 (75+).

Medical tax credits (Section 6A)

If you contribute to a registered medical aid, SARS gives you a monthly medical tax credit of R376 for the main member, R376 for the first dependant and R254 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.

Worked example 1 — R30,000 a month, age 35, medical aid for two

1. Annualise: R30,000 × 12 = R360,000.
2. Bracket 2: R44,118 + 26% × (360,000 − 245,100) = R73,992.
3. Less primary rebate R17,820 → R56,172.
4. Less medical credits (2 × R376 × 12 = R9,024) → R47,148 a year.
5. PAYE per month: R47,148 ÷ 12 = R3,929.00.

Worked example 2 — R18,000 a month, age 67, main member only

1. Annualise: R216,000 → 18% = R38,880.
2. Less primary R17,820 and secondary R9,765 rebates (R27,585) → R11,295.
3. Less medical credit R376 × 12 = R4,512 → R6,783 a year.
4. PAYE per month: R565.25 — a third of what an under-65 employee on the same salary pays.

Worked example 3 — weekly wage of R3,500

1. Annualise: R3,500 × 52 = R182,000 → 18% = R32,760.
2. Less primary rebate R17,820 → R14,940 a year.
3. PAYE per week: R14,940 ÷ 52 = R287.31.

Weekly and fortnightly payrolls must always be annualised first. Applying the monthly table to a weekly wage is the single most common PAYE error we see in migrations from spreadsheets.

Monthly PAYE, UIF and take-home at a glance (under 65, no medical aid)

UIF is capped because the contribution ceiling is R17,712 of monthly remuneration — 1% from the employee and a matching 1% from the employer, so R177.12 each at or above the ceiling.

What sits alongside PAYE on the EMP201

• UIF — 1% employee + 1% employer, capped at R177.12 each per month.
• SDL — 1% of total remuneration, employer only, and only if your annual payroll exceeds R500,000.
• ETI — the Employment Tax Incentive reduces the PAYE you pay over for qualifying 18–29 year olds earning under R7,500 a month.

The EMP201 is due by the 7th of the following month (or the last business day before, if the 7th falls on a weekend or public holiday). Late payment attracts a 10% penalty plus interest.

Bonuses, commission and the 13th cheque

A bonus is taxed in the month it is paid, but SARS expects the employer to spread the effect properly rather than annualising the bonus month as if it repeated 12 times. Payroll Africa uses year-to-date averaging, so a December 13th cheque does not push an employee into an artificial 45% deduction for one month and leave them under-taxed for the rest of the year.

Common mistakes

• Annualising a weekly wage with × 12 instead of × 52.
• Applying only the primary rebate to employees aged 65 and older.
• Forgetting medical tax credits where the employee pays the medical aid personally but the employer processes it.
• Leaving retirement fund and travel allowance treatment out of taxable income.
• Deducting UIF above the R17,712 ceiling.
• Missing the ETI claim on young employees — money left with SARS unnecessarily.

Payroll Africa applies every one of these rules automatically on each run, produces the payslips, and files the EMP201 and IRP5 for you. See also our income tax calculator, UIF calculator and take-home salary calculator.