Which SARS bracket you are in, plus your marginal and effective rates.
Marginal rate
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Effective rate
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Tax after rebates
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Two rates, and why the scary one is not the real one
People often see that the top South African tax bracket is 45 percent and assume that once they earn well, nearly half their salary vanishes. That is not how a progressive system works. Only the slice of income inside each bracket is taxed at that bracket's rate. Your marginal rate, the rate on your next rand, can be high while your effective rate, the share of your whole income that actually goes to tax, stays much lower. This calculator shows you both for any salary, along with the bracket you land in and your tax after rebates.
The seven steps of the SARS scale
South Africa taxes individuals on a seven-band scale. The rates this calculator applies, in line with the SARS individual tax tables, climb from 18 percent on the first slice of income to 45 percent at the very top. The band edges, as modelled here, are R237,100, R370,500, R512,800, R673,000, R857,900, and R1,817,000, with the rates stepping up at each one. These figures are the calculator's working assumption rather than numbers I can certify, so confirm the latest brackets with SARS, especially since the brackets were not adjusted for inflation in the most recent Budget.
- Up to R237,100: 18 percent
- R237,100 to R370,500: 26 percent
- R370,500 to R512,800: 31 percent
- R512,800 to R673,000: 36 percent
- R673,000 to R857,900: 39 percent
- R857,900 to R1,817,000: 41 percent
- Above R1,817,000: 45 percent
Splitting a R500,000 salary across the brackets
Take a taxable income of R500,000 for someone under 65. That income reaches into the third bracket, so the marginal rate is 31 percent. But the tax is built up slice by slice, and after the primary rebate of R17,235 the total comes to R100,272. Divide that by R500,000 and the effective rate is just 20.05 percent, well under the 31 percent headline.
| Bracket slice | Rate | Tax |
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The chart makes the gap between the two rates obvious: the marginal rate is the height of the last step you reach, while the effective rate is the average across the whole climb.
Where this is genuinely useful
Knowing your marginal rate is the key to almost every other tax decision. It tells you the true value of a retirement contribution, because a deduction saves tax at your marginal rate, not your effective one. It tells you what a raise is really worth after tax, and how much a bonus will be reduced. A common mistake is turning down extra income or overtime in the belief that it will push your whole salary into a higher bracket and leave you worse off. That cannot happen on a progressive scale: only the new income is taxed at the higher rate, so a raise always leaves you with more in hand.
Does my whole salary get taxed at my bracket rate?
No, and this is the single most misunderstood point. If your income reaches the 31 percent bracket, only the portion above the previous threshold is taxed at 31 percent. Everything below is taxed at the lower bracket rates. That is why your effective rate, the real share of your income paid, is always lower than the bracket you are in. On R500,000 the effective rate is about 20 percent even though the marginal rate is 31 percent.
How do the over-65 rebates change my bracket?
They do not change which bracket your income falls into; the brackets are the same at every age. What changes is the rebate subtracted from your tax. From 65 you get an extra secondary rebate, and from 75 a tertiary one, so your tax after rebates is lower and the income at which tax starts is higher. Switch the age band in the calculator to see your effective rate drop while the marginal rate stays put.