Your Package

Select the year of assessment (1 March – 28/29 February). The severance benefit table has been unchanged since 2023.
The genuine severance/retrenchment lump sum from your employer (typically at least one week's pay per completed year of service). This qualifies for the R550,000 tax-free tier.
R
Amounts that are NOT a severance benefit — notice pay, accrued leave pay, and pro-rata bonus. These are taxed as normal income at your marginal rate, not on the lump-sum table.
R
The tax bracket your regular salary puts you in. Used to tax the notice/leave/bonus portion. Unsure? Use our Tax Bracket calculator.
Total of any retirement, death or severance lump sums you have received before. These are aggregated with this severance benefit, so a second lump sum is taxed at a higher rate. Leave at 0 if this is your first.
R

Estimate only. The R550,000 tax-free tier applies to a genuine severance benefit — broadly, an employer-initiated retrenchment, reaching age 55, or ill health — and is cumulative across all lump sums since 1 October 2007. SARS issues a tax directive that determines the actual tax. Consult a registered tax professional for your situation.

Package After Tax

R 646 200

After R 33 800 tax on a R 680 000 package.

Total Tax

R 33 800

Effective Tax Rate

5.0%

2027 (Mar 2026 – Feb 2027)First R550,000 tax-free

Where Your Package Goes

Detailed Calculation

Severance BenefitR 600 000
Tax on Severance− R 9 000
Notice / Leave / BonusR 80 000
Tax at Marginal Rate (31%)− R 24 800
You Take HomeR 646 200
Severance on the R550k table; other pay at your marginal rate.