The people who pay the most tax in South Africa

The South African Revenue Service (SARS) annual tax statistics break down personal income tax (PIT) payers, showing which groups pay the most tax and from where.

The latest tax data from SARS shows that the taxman collected R2.2 trillion in gross tax revenue in the 2023/24 fiscal year, R87.0 billion or 4.2% more than in the prior year.

The 2023/24 fiscal year saw a sharp decline in Company Income Tax (CIT) revenue, particularly in the mining sector.

This decline was mainly a result of low commodity prices, which offset the revenue gains from the elevated commodity prices over the previous two years.

In addition, weak global growth, persistent power outages, and logistical disruptions further weighed on the sector.

Value-Added Tax (VAT) revenue growth remained subdued as consumers continued to face financial constraints due to high interest rates, which erodes disposable household income and expenditure.

Personal Income Tax (PIT) revenue, however, remained buoyant, supported by a recovery in employment and earnings. Personal income tax remained the biggest source of tax income (37.4%)

The number of individuals expected to submit Income Tax returns was 7.6 million for the 2023 tax year.

For PIT, geographic, demographic, and other analyses of the assessments of the taxpayers who had been assessed by 9 September 2024 for the 2023 tax year showed that:

• 2,361,099 (35.5%) of assessed taxpayers were registered in Gauteng.
• 855,274 (36.2%) of assessed taxpayers lived in the Johannesburg Metro and were taxed on an average taxable income of R484 672.
• 1,775,779 (26.7%) of assessed taxpayers were from 35 to 44 years old.
• 3,495,942 (52.6%) of assessed taxpayers were male; 3,148,808 (47.4%) were female.
• Assessed taxpayers reported an aggregated taxable income of R2.3 trillion and tax liability of R499.9 billion.
• The average tax rate was 21.3% versus 21.5% in the previous tax year.

The table below outlines who pays the most tax in each category for PIT:

Tax by income bracket

It is evident that South Africa’s tax collection is still anchored at the top, reflecting the country’s progressive tax system.

While those earning over R500,000 a year only make up 19.8% of taxpayers, they account for 46.8% of all taxable income and 76.2% of all assessed income tax.

Zooming into the data and brackets further, millionaires emerge as the biggest taxpayer group in the country, where 242,226 individuals pay 25% of all PIT.

This is followed by those earning R500,00-R750,000 (18%) and those earning between R2 million and R5 million (15%).

Tax by age

It should come as no surprise that the bulk of taxes come from the country’s working-age population, particularly those between 35 and 44 years old.

The breakdown of tax assessed by age has remained fairly stable throughout the years, pointing to no dramatic shifts among taxpayers.

This must be read in the context of South Africa’s struggled with high unemployment, particularly among the youth.

The 18-24 bracket has not only remained consistently low, but saw a significant decline off an already low base in 2023, dropping to 4.9% amid record levels of youth unemployment in the country.

Tax by gender

The gender pay gap remains evident in the tax stats, with males accounting for the majority of tax collected across all but two taxable income brackets.

Things are fairly level at the centre, but spike massively in favour of males past incomes of R750,000 a year or more.

At the top, the vast majority of millionaires are male.

Tax by location

As the economic hub and most populous province in the country, Gauteng remains the biggest source of income tax, accounting for almost half of all PIT collected.

Zooming in on the province, most of the tax assessed comes from the City of Joburg, followed by the City of Tshwane.

Tax by job type

Most PIT is sourced from income in South Africa, being wages, salaries and other remuneration. This makes up 75.6% of all PIT collected.

Within this income category, the stats break down the various job sectors this comes from, largely via pay as you earn (PAYE).

Almost half of PAYE comes from the finance sector, which includes intermediation, insurance, real estate and business services.

Community, social and personal services make up 27.5%. Notably, the community sector includes government jobs and services.

Read: The tiny municipality in South Africa where people earn more than R500,000 a year