South African employers face important compliance changes in 2026 that will impact payroll and HR processes. The South African Revenue Service (SARS) will enforce mandatory tax reference numbers for all employees in the upcoming Employer Filing Season, while the National Minimum Wage will increase from 1 March 2026. Employers and global mobility teams must update systems and processes to ensure compliance and mitigate the risk of penalties.
Mandatory Tax Reference Numbers from February 2026
All employee records submitted in PAYE reconciliations must include a valid Income Tax Reference Number (TRN). From February 2026, reconciliations submitted without TRNs will be rejected and may trigger administrative penalties.
Action Points for Payroll Teams
SARS has established a Large Business Forum to enhance engagement with key taxpayers and promote collaboration on compliance and risk management.
National Minimum Wage Increase – Effective 1 March 2026
Updated Hourly Rates
The statutory National Minimum Wage (NMW) will increase as follows:
This represents a 5 per cent increase from the previous baseline of R28.79 per hour.
Sector Specific Adjustments
Employers in sectors covered by sectoral determinations, such as wholesale, retail, and contract cleaning, should review updated wage tables and regional variations to confirm applicable rates.
System and Process Updates
Employee Communications
Risk and Penalty Considerations
For further detailed guidance on payroll, employment law and compliance in South Africa, visit our South Africa Global Insights page on the activpayroll website.
For more information on how these 2026 tax and minimum wage updates may impact your business, please get in touch. Complete our Contact Us form and a member of our expert team will be happy to assist with your queries.