Any Employee’s remuneration is subject to monthly deductions referred to as PAYE. Apart from salaries, commission etc. the following income/payments are also subject to PAYE:

• 80% of any travel allowance reduced to 20% if the employer is satisfied that the employee travels at least 80% of the time for business
• The portion of any reimbursive travel allowance that exceeds the tax-free limit per kilometer
• Remuneration paid to labour brokers/personal service providers
• Annuities from Annuity Funds
• Payments to Personal Service Providers (PSP’s)

See PSP process flow for more detail on entities that will be considered PSP’s. A PSP is subject to employees’ tax at the rate of 28% if it is a company and 45% if it is a trust. Expenses to be deducted by a PSP are also limited.

Directors of companies are subject to PAYE according to the same rules applying to other employees.

Part-time, casual and temporary employees are subject to PAYE at a flat rate of 25%.

Variable remuneration, such as overtime pay, bonus, commission, night shift and standby allowance or reimbursement of any expenditure accrue to the employee only on the date that it is paid. The employer is also only deemed to have incurred the variable remuneration on the date of payment.