Understanding Your Payslip: What Every Line Means
Your payslip can look confusing with all those numbers and codes. But it is actually simple once you know what each line means. Here is a plain-language guide to every deduction on your South African payslip.
Key Takeaways
- Gross salary = your full salary before anything is taken off
- PAYE = income tax taken by your employer for SARS
- UIF = insurance for if you lose your job (1% of salary)
- Net salary = what actually lands in your bank account
- Your employer also pays money on your behalf that you do not see
Gross Salary (your full pay)
This is the total amount your employer pays you before any deductions. It includes your basic salary plus any allowances like travel or housing. This is NOT what you take home — deductions come off this amount.
- Basic salary + allowances = gross salary
- This is the number in your employment contract
- All deductions are calculated from this amount
PAYE (income tax)
This is usually the biggest deduction. PAYE is income tax. Your employer calculates how much tax you owe based on your annual salary and the SARS tax tables. They take it off every month and pay it to SARS for you.
- The amount depends on how much you earn
- Higher salary = higher tax rate (18% to 45%)
- If you have an RA or medical aid, your PAYE will be lower
UIF (Unemployment Insurance Fund)
UIF is 1% of your gross salary (up to a maximum salary of R17,712). Your employer also pays an extra 1% that you do not see on your payslip. This money goes into a fund that pays you if you lose your job or go on maternity leave.
- You pay: 1% of your salary
- Your employer pays: another 1% (you do not see this)
- Maximum deduction: R177.12 per month
- You can claim UIF if you are retrenched or go on maternity leave
Pension / Provident Fund
If your company has a pension or provident fund, you will see a deduction for your contribution. Your employer usually also contributes. This money is for your retirement. The good news is that these contributions reduce your taxable income, so you pay less PAYE.
- Your contribution is usually 5% to 10% of your salary
- Your employer often matches this or pays more
- Reduces your taxable income (saves you tax)
- You can only access this money when you retire or leave the company
Medical Aid
If you belong to a medical aid through your employer, the monthly premium is deducted from your salary. You get tax credits for this (R364 per month for you and first dependant, R246 for each extra dependant).
- The full premium is deducted from your salary
- You get tax credits that reduce your PAYE
- Some employers pay a portion of your medical aid for you
Net Salary (your take-home pay)
This is the final amount that goes into your bank account. It is your gross salary minus all deductions (PAYE, UIF, pension, medical aid, and anything else). This is the money you actually get to spend.
- Net salary = Gross salary minus all deductions
- This is what lands in your bank account
- Use our PAYE Calculator to work out your exact net salary
Ready to see your own numbers?
Use the PAYE Calculator