Mr Ramaphosa said the gesture was aimed at encouraging the wealthy to dedicate some of their pay to help build the nation.
The donation of 1.8m rand ($130,000; £100,000) will be managed by the Nelson Mandela Foundation (NMF).
Mr Ramaphosa is one of South Africa’s richest men, with a fortune of around $450m.
His critics often accuse him of being out of touch with the poor, and he was criticised for bidding more than $2m for a buffalo and her calf in 2012.
Mr Ramaphosa, 65, was a businessman before he became deputy president in 2012.
He held a stake in sectors from telecoms and the media to beverages and fast food – he owned the South African franchise of the US chain, McDonalds.
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Mr Ramaphosa’s decision to take a pay cut has been met with mixed reactions in South Africa, reports the BBC’s Pumza Fihlani from the main city, Johannesburg.
Some feel the donation is “peanuts” given his wealth, while others see it as a selfless move aimed at reintroducing a culture of public service in the governing African National Congress (ANC), she adds.
Speaking in parliament on Wednesday, Mr Ramaphosa said he had decided to make the donation to the NMF in honour of South Africa’s first democratic president, Nelson Mandela.
“This is a private, citizen-driven initiative that will ask all those with the means to contribute a small portion of their salaries to supporting the many small projects that build the nation,” Mr Ramaphosa said.
The fund will be launched on 18 July to mark the 100th anniversary of Mr Mandela’s birth.
Mr Ramaphosa became president in February after Jacob Zuma was forced to resign amid a welter of corruption allegations.
Mineral Resources Minister Gwede Mantashe said in January that Mr Ramaphosa would not be corrupt because he did not need the money.
“He is wealthy, he is rich. If he steals, we will ask him: ‘Why do you steal, because you have enough?'” Mr Mantashe said.
What have other leaders done?
US’s Donald Trump donates his annual salary of $400,00 to different programmes
Liberia’s George Weah allocates 25% of his annual salary of about $100,000 to a development fund
Nigeria’s Muhammadu Buhari took a 50% pay cut when he assumed office in 2015
Russia’s Vladimir Putin took a 10% pay cut in 2015 because of tough economic times