Enter your annual bonus, 13th cheque, or performance bonus.
Total Bonus
R 10 000,00
Bonus Take-Home
R 6 900,00
Total Deductions on Bonus
R 3 100,00
Effective Rate
31.0%
Marginal Rate
0.3%
South Africa does not have a separate bonus tax rate. SARS uses the annual averaging method: your bonus is added to your projected annual income, and the incremental tax is calculated.
Because a bonus pushes your total income higher, part of it may fall into a higher marginal bracket. This calculator isolates the additional tax caused by the bonus.
UIF on Bonus: UIF at 1% applies to the bonus as part of your total remuneration, subject to the monthly cap of R177.12.
How is my bonus taxed in South Africa?
SARS uses the annual averaging method. Your bonus is added to your annual income, and the difference in tax between your total income (with bonus) and your income without the bonus determines the tax on the bonus. There is no separate bonus tax rate.
Does UIF apply to bonus payments?
Yes, UIF contributions apply to bonuses as part of your total remuneration. The employee UIF rate is 1%, capped at R177.12 per month.
Is a 13th cheque taxable?
Yes. A 13th cheque (or annual bonus) is fully taxable as part of your employment income. It is taxed using the SARS annual averaging method.
Can I reduce the tax on my bonus?
Contributing to a retirement annuity fund (up to 27.5% of taxable income, capped at R350,000 per year) can reduce your taxable income and thus the tax on your bonus.
How SARS taxes your bonus and why it often feels like you lose more than expected
How is a bonus taxed in South Africa?
Your bonus is taxed as part of your total annual income using the PAYE system. SARS treats your bonus as extra earnings for the year. Your employer works out the tax on your full annual income (salary plus bonus), subtracts the tax already paid on your salary, and the difference is the tax on your bonus. On a R400,000 salary with a R50,000 bonus, the bonus portion could attract a marginal rate of 31% or more.
Why does my bonus seem to be taxed at a higher rate?
Because South Africa uses progressive tax brackets, your bonus sits on top of your regular salary. This pushes it into a higher bracket. For example, if your salary already fills the 26% bracket, your bonus may fall entirely in the 31% or 36% bracket. This is not a special penalty — it is how progressive tax works.
Does UIF apply to my bonus?
Yes, UIF at 1% applies to your bonus. However, UIF contributions are capped at a maximum remuneration of R17,712 per month. If your regular monthly salary already exceeds this cap, no additional UIF is deducted from your bonus. The maximum monthly UIF contribution is R177.12.
Can I reduce the tax on my bonus?
You can reduce your overall tax by making retirement fund contributions. Contributions to a pension, provident, or retirement annuity fund are tax-deductible up to 27.5% of your remuneration or taxable income (whichever is higher), capped at R350,000 per year. Making an extra contribution before your bonus is paid can lower your taxable income.
What is the difference between a 13th cheque and a performance bonus?
A 13th cheque is a guaranteed extra month of salary, usually paid in December. A performance bonus depends on meeting targets. Both are taxed the same way — as additional remuneration under PAYE. The timing of when they are paid can affect which tax year they fall into.
How does my employer calculate PAYE on a bonus?
Your employer adds your bonus to your year-to-date earnings, calculates the total annual tax using SARS tables, subtracts the tax already withheld so far, and the result is the PAYE on your bonus. This is called the averaging method. It ensures you pay the correct annual tax rate across all your earnings.
Will I get a tax refund if too much was deducted from my bonus?
Sometimes. If your employer over-estimated your annual income when calculating the bonus PAYE, you may receive a refund when you file your ITR12 tax return. This can happen if you earned less than expected in the remaining months, or if you have deductions (like medical expenses or retirement contributions) that were not fully accounted for during the year.
SARS-Aligned: Based on 2025 SARS rates and thresholds. For personal advice, speak to a qualified tax practitioner.
Disclaimer: This calculator provides estimates based on current HMRC rates and thresholds for the 2025/26 tax year. It does not constitute professional tax, financial, or legal advice. Your actual liability may differ depending on your individual circumstances. Always consult a qualified accountant or tax adviser before making financial decisions. Read our terms
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