How PAYE works in Kenya

What is PAYE charged on?

PAYE is not charged on your gross pay. It is charged on taxable pay — gross pay less the deductions the law allows to come off before tax is computed. The most common of those is a pension contribution, up to the statutory limit.

This is the single most misunderstood thing about PAYE, and it is why two people on the same gross salary can owe different amounts of tax: the deductions that come off before the tax is worked out are not the same for both.

The rate, from source

How graduated bands actually work

Kenyan PAYE is graduated, which means the rates apply in slices. Your first slice of taxable pay is taxed at the lowest rate; only the portion that falls into a higher band is taxed at that higher rate. Crossing into a new band never taxes your whole salary at the new rate — a raise cannot leave you worse off.

Once the bands have been applied and a gross tax figure exists, personal relief is subtracted from that figure. Relief reduces the tax, not the income. Below a certain level of taxable pay, relief cancels the tax entirely and no PAYE is due.

What else comes off the same payslip

PAYE is one of 5 statutory items on a Kenyan payslip, collected by 4 different bodies. Some of them reduce the pay PAYE is computed on; others sit alongside it. The Kenya payroll page lists every one with its current rate and source.

Who deducts it, and when it is due

The employer deducts PAYE and remits it — the obligation is the employer’s, not the employee’s. PAYE, NSSF, SHIF and the housing levy are remitted by the 9th of the month following payroll, through KRA’s iTax P10 return.

Missing that date is what turns an arithmetic problem into a penalty, which is why most Kenyan payroll calendars are built backwards from the 9th rather than forwards from payday. See payroll deadlines in Kenya for the full monthly cycle.

Working it out on a real number

The bands, the relief and the pre-tax deductions interact, so the reliable way to answer “what will I actually take home?” is to run the figure. The Kenya salary calculator applies the current bands, relief and every other statutory item to a gross salary and shows the breakdown line by line.

Rates on this page are rendered from our statutory dataset and were last reviewed against source on 2026-07-14. Statutory rates change with every finance act — check any figure against the relevant authority before you rely on it.