Payroll Fundamentals for South Africa
Master the basics of South African payroll processing with PayMax. Learn about PAYE, UIF, SDL, statutory requirements, and payroll cycles that every SA business needs to understand.
Key Payroll Components
Gross Salary
The total salary before any deductions
Includes basic salary, allowances, bonuses, and overtime payments
PAYE (Pay-As-You-Earn)
Income tax deducted from employee salaries
Calculated using SARS tax tables and submitted monthly to SARS
UIF (Unemployment Insurance Fund)
2% total contribution (1% employee + 1% employer)
Maximum monthly contribution capped at R177.12 per person
SDL (Skills Development Levy)
1% of payroll for employers with annual payroll > R500,000
Paid by employer only, used for skills development initiatives
Standard Payroll Cycle
Data Collection
Gather employee hours, leave, allowances, and deductions
Calculation
Calculate gross pay, taxes, and statutory deductions
Review & Approval
Review calculations and approve payroll run
Payment Processing
Process salary payments to employee bank accounts
Reporting
Submit PAYE, UIF, and SDL returns to SARS
Essential Concepts
Why Payroll Matters
- Legal compliance with South African labour laws
- Accurate tax calculations and SARS submissions
- Employee trust and satisfaction
- Business financial planning and budgeting
Common Challenges
- Complex tax calculations and rate changes
- Keeping up with regulatory changes
- Managing multiple employee types
- Accurate record keeping and reporting
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