Statutory topics
PAYE and statutory payroll deductions
Not every deduction is lawful, and the ones that are follow an order. This page sets out the categories of payroll deduction in South Africa, the legal basis for each and the limits an employer must respect.
The three categories of deduction
Statutory deductions
Required by law: PAYE and the employee's UIF contribution. These are not optional and require no employee consent.
Court and council-ordered deductions
Garnishee orders, emoluments attachment orders and bargaining council levies. The employer must comply with a valid order and pay the amount to the correct beneficiary — see third-party payments.
Voluntary and contractual deductions
Retirement funding, medical scheme contributions, union subscriptions, insurance and staff loans. These require the employee's written agreement or a term in the contract of employment.
What employers may not deduct
- Losses or damage, unless the strict BCEA conditions for such a deduction have been met
- Employer costs such as SDL or the employer UIF contribution
- Amounts exceeding statutory limits for loss or damage recovery
- Deductions with no written consent, court order or legal requirement behind them
Deduction order and net pay protection
Statutory deductions are applied first, then court-ordered amounts, then voluntary deductions. Where the remaining pay is insufficient, voluntary deductions must be reduced or suspended rather than pushing net pay negative.
Recovering overpayments
An overpayment to an employee may generally be recovered, but the recovery should be agreed in writing, applied over a reasonable period and reflected transparently on the payslip. Recovering a full overpayment from a single pay cycle is a common source of disputes.
Frequently asked questions
What deductions are compulsory on a South African payslip?
PAYE, where the employee's remuneration is above the tax threshold, and the employee's UIF contribution, where the employee is not excluded from UIF.
Can an employer deduct for damage or losses?
Only where the strict BCEA requirements are met, including a fair procedure, the employee's written agreement and a limit on the amount that may be recovered in a period.
In what order are deductions applied?
Statutory deductions first, then court or bargaining council-ordered deductions, then voluntary and contractual deductions. Voluntary deductions are reduced when there is not enough remaining pay.
Must deductions be shown on the payslip?
Yes. The BCEA requires payslips to itemise the remuneration, the deductions made and the amount actually paid to the employee.
Patuza reviews your deduction codes, consents and limits so payslips stand up to scrutiny.
Book a consultationRelated services
- Payroll processing →
Monthly and weekly payroll processing, calculations, payslips and statutory deductions.
- Third-party payments →
Garnishees, medical aid, retirement funds, unions and councils paid from accurate schedules.
- Payroll compliance →
PAYE, UIF, SDL, EMP201, EMP501 and IRP5 compliance managed end to end for SARS.
Related topics
- PAYE →
Pay-As-You-Earn: how employees' tax is calculated, withheld, declared and paid to SARS.
- UIF →
Unemployment Insurance Fund contributions, declarations and employer obligations.
- Net pay →
How take-home pay is derived from gross remuneration, deductions and tax.
- Employee contributions →
What employees contribute to retirement, medical and statutory funds, and its effect on pay.
Related insights
- BCEA payslip template →
Compliant payslip layout you can download.
- Lawful payroll deductions →
What an employer may and may not deduct from an employee's pay.
Last reviewed 2026-03-01. Rates, thresholds and limits are set by legislation and change — most commonly in the annual Budget. This page explains how the obligation works; always confirm current values against the official SARS or Department of Employment and Labour publication for the applicable tax year.