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Ntoko says: 29 March 2022 at 14:17 How do you tax 13th cheque bonus if you earn 14560. 88 as basic salary before deduction |
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TaxTim says: 29 March 2022 at 16:13 It will be added to your salary and taxed per the normal PAYE rates. Your bonus amount simply becomes part of your total taxable income for the year, which may impact your tax bracket, i.e. the percentage of tax you pay on your income. The amount of tax withheld in your bonus month depends on which method your company uses to calculate tax. If you take your salary and times it by 13 (12 months and 1 bonus) it will bring you to R 189 291,44, this is your taxable income for the year, SARS will then calculate the tax due on the total amount, and your employer will then divide this amount by 13 and the month that you receive your bonus, your tax will be double the amount you usually pay each month. It's useful to note, that some employers allow tax smoothing; this is where your 13th cheque amount is already included in your employment contract and the payrolls officer can then offer to instead of deducting the tax due on your bonus all in one month, to increase your tax due over the year and it will then not be such a big chunk of your bonus taken during that month only. Please make use of our income tax calculator to work out the annual tax you will pay on your income. SARS income tax calculator |
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