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Home / Tolley's Global Mobility: Employment Taxes (Worldwide excluding Europe) /South Africa /2. Mechanics of payroll / 2.1 Withholding of income tax
Commentary

2.1 Withholding of income tax


South Africa

2.1ÌýÌýÌýÌý Withholding of income tax

The obligation to withhold and deduct PAYE from employee earnings (PAYE) is governed by the Fourth Schedule to the ITA. Paragraph 2 states that every:

  1. Ìý

    •ÌýÌýÌýÌý employer who is resident

  2. Ìý

    •ÌýÌýÌýÌý employer who is not a resident and conducts business through a permanent establishment in South Africa, or

  3. Ìý

    •ÌýÌýÌýÌý representative employer

who pays or becomes liable to pay 'remuneration' to an employee must withhold PAYE from that amount.

There are three requirements which must be satisfied before the PAYE withholding obligation arises, which are specifically defined in the Fourth Schedule:

  1. Ìý

    •ÌýÌýÌýÌý there must be an 'employee', and

  2. Ìý

    •

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