Rules and personal circumstances differ. Confirm current details with the relevant official source or a qualified professional before acting.
How PAYE works
Your employer estimates employees’ tax using SARS deduction tables and information available to payroll. PAYE is shown on your payslip and later on your IRP5 or IT3(a).
For the 2027 tax year, individual marginal rates range from 18% to 45%. A marginal rate applies only to the portion of taxable income inside that bracket.
Why the final assessment can differ
- You had more than one employer or income source.
- A bonus or taxable benefit changed annual remuneration.
- Payroll did not have all deductible-contribution information.
- SARS allowed or rejected deductions and credits on assessment.
What to keep
Keep payslips, IRP5 certificates, retirement contribution certificates, medical-scheme certificates and supporting records relevant to your return.
A simple example
If you work for two employers at the same time, each may deduct PAYE as if its salary were your only income. SARS assesses the combined annual taxable income, which can create a shortfall.
Common mistakes
- Multiplying all income by the highest bracket rate
- Assuming PAYE means no tax return or review is needed
- Ignoring an incorrect IRP5 or tax number
Quick checklist
- Check PAYE on each payslip
- Confirm your IRP5 details after year-end
- Keep supporting certificates
- Review any SARS auto-assessment before accepting it
Frequently asked questions
What is the main takeaway from what is paye??
PAYE is a prepayment towards annual income tax, not a separate tax and not always the final amount owed.
What should I do first?
Check PAYE on each payslip
What is a common mistake?
Multiplying all income by the highest bracket rate
Use the numbers, not a guess
Try a free calculator or continue with a related South African guide.
Related guides
Reviewed on 27 July 2026. Official links below are the source of current legal, tax or regulatory facts; practical guidance is general.