Is UIF Calculated on Basic Salary? (2024)

The Unemployment Insurance Fund is a scheme that caters for those that are ready to contribute to the system. Unemployment is unpleasant and it is something that is not planned for, this is why the UIF was established and meant to tackle issues like this. UIF is not calculated on the basic salary, it is calculated on gross salary and these are some of the reasons why.

Every month employers are asked to contribute to the UIF scheme and this scheme tends to cater for them if they fall into any of the categories which include; unemployment, illness, death, adoption and maternity leave. The UIF has placed it upon itself to tackle all of this for the citizens that are contributing to their system.

Is UIF Calculated on Basic Salary?

There are so many misconceptions about the UIF and it is possible for you to get the wrong information, this is why it is advisable that you read lots of content about the UIF scheme so you can easily know which is wrong or right. The UIF is not being calculated on basic salary, now there is a difference between basic salary (net) and gross salary. The gross salary is the initial amount paid to an employee and the basic salary is the amount an employee gets after deductions, which include UIF contributions tax, amongst other expenses. The UIF contribution is therefore calculated from the gross salary and gives you your basic salary in the end. Employees should pay the UIF contribution as this will give them access to the benefits that the UIF provides.

One of the easiest ways of knowing how much you would receive from the UIF is by calculating your benefits/claims. The UIF has also made it possible for its contributors to be able to calculate their benefits or claims and you can use an online calculator or use the formula that has been provided by the UIF. The online calculator allows you to calculate your UIF from 4 years below, while the formula which was provided gives you the opportunity of calculating your UIF on the number of years that you have worked.

You can use this formula to calculate your UIF benefits; Total benefit amount = daily benefit amount x available credit days. Credit days are accumulated as follows: for every four days that you work as a contributor, you receive one day’s credits subject to a maximum of 365 credit days. Daily benefit amount (DBA) = 66% of income capped at R17712 per month.

If you do not want to use this formula method you can opt for the online calculator method as this will give you accurate earnings as well. This calculator only calculates your UIF benefits that are up to 48 months or below. Anything more than that it does not accept it.

The amount you will receive as a benefit for the UIF depends on your contribution over the years and your monthly salary. If you have been contributing to the UIF system consistently for six months or even four years you are entitled to receive benefits for four months and entitled to receive benefits for 365 days if you have been contributing for four (4) years.

The payout for the UIF is about 38-58% of your salary and if you are earning higher you will be paid well as well. The highest amount for the UIF payout is R6 730 and the UIF does not pay below minimum wage which is R3 500. As an employee whether a domestic or a commercial employee you are supposed to pay a monthly contribution of about 1% of your salary as this makes up part of the UIF and your employer will have to do the same as well.

Your employer will deduct the 1% that is needed from your salary before giving it over to you and then make payment which you will be able to see on your UIF dashboard once you log in.

Once you qualify for a claim on the UIF you will have to apply for benefits and you will ask to provide some documents, the documents that you are asked to provide are solely dependent on the type of benefits you are trying to claim because each benefit has different documents that are needed from you. You can apply for claims/benefits online or you can visit the labour office to carry it out.

You are advised to carry your ID and reference number as you will be asked for this. A reference number is a unique number that is given to your employer and this number will be used to register you as an employee on the UIF platform and it has access to show all your details. If an employer has 10 employees, each employee will have to use the same reference number as this is used to identify an employee of a particular company.

There is so much importance in contributing to the UIF scheme and you can rest assured that at the right time you will be benefitting from it. You should know that the moment you retire from your job you are no longer entitled to any benefit from the UIF and if you are involved in any cases of fraud or misconduct in your workplace and you get fired, the UIF will investigate the issue and if you are found guilty you won’t be entitled to receiving any benefit from the scheme.

This is why you are advised to follow the rules of the scheme so you can enjoy the benefits later on in the long run, once you follow the rules and make sure you are verified when it comes to taking benefits then you are good to go.


The UIF is calculated on gross salary and not basic salary as an employee receives the basic salary after tax and the UIF deductions have been collected. We have given you every information relating to the UIF in this article, I hope we have been able to answer your questions. It is advisable that you contribute to the UIF scheme as this will be of benefit to you later on.




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