EMPLOYEE’S TAX

This is a withholding tax on employment income. Employers deduct the tax (in the form of Pay as You Earn tax) from the employment income of employees and pay it over to the South African Revenue Service (SARS) on a monthly basis. Pay as You Earn (or PAYE) is calculated based on an employee’s earnings and includes basic salary, bonuses, fringe benefits and other allowances. Employers consult the SARS PAYE tables to determine the different tax rates for employees.