Financial Literacy for Everyone

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Understanding a payslip

Your gross salary is your basic salary plus any benefits, such as overtime. Your net salary is what remains of your gross salary after all the deductions have been made. Your net salary is usually paid into your bank account each month.

Common deductions are:

  • Income Tax
  • Unemployment Insurance Fund (UIF)
  • Medical Aid contributions
  • Pension and Provident fund contributions
  • Trade union contributions

Income Tax

All the people who receive more than a certain minimum salary, pay income tax to the Government. The Government uses this money to provide roads, healthcare, education, safety, water and electricity, houses for the poor, parks and libraries. Most people who earn a salary pay their income tax as PAYE, or Pay As You Earn.

The other deductions are described in more detail under the appropriate headings in this section.