What Is the Minimum Salary to Pay Tax in South Africa?
Every individual living in South Africa is liable to pay tax if they fall into the category determined by the South African Revenue Services. They have to pay taxes according to the fixed rates for every slab. If you’ve recently been promoted or are getting profits from more than one business/investment, scroll down to see the table.
You’ll know the minimum salary/income that makes you liable to pay tax in the country. Keep reading till the end to know what sources of income are taxable.
Minimum Salary To Pay Tax In South Africa
The people of South Africa are liable to pay taxes like others worldwide. They have to pay the tax according to their worldwide income. Even if you are not a South African citizen, you must still pay the tax amount according to the slab below.
The permanent residents and non-residents have to pay the same amount of tax every year according to their total income. If you’ve started working recently or moved to South Africa, knowing the minimum salary makes you a taxpayer is important. I have discussed the age group and the tax rates so you can know what amount will be deducted from your income.
Tax Threshold
The South African Revenue Service also known as SARS revises their tax rates yearly. Every individual should expect to pay the tax if they fall into any of the categories mentioned in the table below. Every taxpayer has to pay a different amount according to the profit he’s making.
The higher the total income, the higher the tax rate. Individuals who earn more are liable to pay higher amounts than people who earn less comparatively. The following table allows you to know the tax rates for the year 2023-2024.
| Income | Tax In ZAR | Tax On Access Amount |
| R 1 to R 237 100 | R 0 | 18% |
| R 237 101 to R 370 500 | R 42 678 | 26% |
| R 370 501 to R 512 800 | R 77 362 | 31% |
| R 512 801 to R 673 000 | R 121 475 | 36% |
| R 673 001 to R 857 900 | R 179 147 | 39% |
| R 857 901 to R 1 817 000 | R 251 258 | 41% |
| R 1 817 001 and above | R 644 489 | 45% |
The taxable income is the profit that you earn in a year. These deductions are made so you can utilize them later. Expenses such as retirement funds or medical expenses are paid from these deductions.
Age Group And Income
As a South African citizen, you are liable to pay tax if your annual income is more than R 95 750. You should be less than 65 years of age to fall into this category. If you are older than 65, you should earn more than R 14 217 to become a taxpayer.
People older than 75 should have a total income of R 165 689 to pay taxes. If you are a South African resident who earns less than R 95 750, you are not liable to pay tax. This is the tax threshold determined by SARS to help people know the amount that will be deducted from their total income/earnings.
How To Determine Total Income For Paying Tax?
The South African Revenue Service provides the tax table for every year as mentioned above. Many individuals cannot determine if their total income falls under the threshold which makes them liable to pay the tax.
I have listed a few income sources that are taxed according to SARS. Go through the points to see if they add up to your income and make you liable.
- The easiest and the most common source of income is your salary, wages, or allowances as an employee.
- Your profit or income from a business or a trade is taxable.
- Any rental income or benefits from trusts or organizations that exceed the limit stated above make you tax-liable.
- Pensions or capital gains from any of your investments are also taxable.
All these sources of income are taxable only if you exceed the limit that is mentioned in the table above.
Do foreigners pay taxes in South Africa?
You have to pass the “Physical Presence Test” to prove yourself as a South African resident liable to pay tax. If you fail to do so, you’ll be considered a non-resident.
This does not make you liable for all your income. You will have to pay the tax on the income that is earned within the country and that too if it falls into the threshold.
Who is exempt from tax in South Africa?
Individuals earning less than R 95 750 are not liable to pay any tax when residing in South Africa. The tax threshold determined by the South African Revenue Service gives them a free hand if they do not fall into the category. However, people earning more than this amount have to pay taxes according to tax rates stated by SARS.
Do temporary workers pay tax in South Africa?
Temporary workers have to pay the necessary tax if they work for more than 22 hours a week. It is considered as standard employment and 25% is deducted from their monthly salary. If the working hours are less than 22 per week, no deductions are made at the end of the month.
A detailed article with information on the minimum salary to pay tax in South Africa is written so you can have an idea about the deductions. You are liable to pay tax if you fall into any one of the seven categories determined by SARS.
The residents and the non-residents have to pay the same amount of tax if they are earning the same money. I hope the article helps determine the tax rate for the upcoming year. You can have an estimate to know what category you fall in.
