Kenya PAYE uses four progressive brackets from 10% to 35%, with a KES 2,400/month personal relief deducted from tax payable. Employees also pay 2.75% SHA health levy, approximately 6% NSSF on pensionable pay up to KES 18,000/month, and a 1.5% Affordable Housing Levy on gross salary. At KES 100,000/month, effective PAYE after personal relief is approximately 22.4%, with total deductions of around KES 32,000/month.
At a glance
Key Facts
PAYE System
Four-bracket progressive system administered by the Kenya Revenue Authority (KRA)
Tax Brackets (2026)
10% on KES 0–24,000/month; 25% on KES 24,001–32,333; 30% on KES 32,334–500,000; 35% above KES 800,000/month
Personal Relief / Allowance
KES 2,400/month (KES 28,800/year) — deducted from tax payable, not from income
Social Security Contribution
NSSF: 6% of pensionable pay up to KES 18,000/month; SHA: 2.75% of gross; Affordable Housing Levy: 1.5% of gross
Tax Authority
Kenya Revenue Authority (KRA) — kra.go.ke; iTax platform for filing
Tax Year
January 1 – December 31
Introduction
Kenya’s Pay As You Earn (PAYE) system is administered by the Kenya Revenue Authority (KRA) under the Income Tax Act (Cap 470). It is one of the most discussed PAYE systems in East Africa — not just because of its rate structure, but because of the additional statutory deductions layered on top since 2023. In addition to income tax, Kenyan employees pay contributions to NSSF (new 2023 rates: 6% of pensionable pay up to KES 18,000/month), the Social Health Authority (SHA) levy at 2.75% of gross replacing NHIF, and the Affordable Housing Levy (AHL) at 1.5% of gross. Together these make Kenya’s total statutory payroll deduction burden one of the highest in East Africa.
The introduction of additional levies was politically contentious. Kenya’s Finance Bill 2024, proposing further tax increases, was withdrawn after mass protests in June 2024. However, the AHL and SHA levy — introduced via separate legislation in 2023 — remain fully in force as of 2026. Understanding all statutory deductions (PAYE, NSSF, SHA, AHL) is essential for accurate take-home pay calculation. The tax year runs January 1 to December 31. This guide covers 2026 brackets, all four deductions, worked salary examples at KES 50,000, 100,000, and 200,000/month, and KRA filing obligations.
Section 01
Kenya Income Tax Brackets 2026
Kenya’s PAYE brackets are applied on monthly income. The following are the 2026 rates as published by the Kenya Revenue Authority:
Monthly Income (KES)
Annual Equivalent (KES)
Marginal Rate
KES 0 – 24,000
KES 0 – 288,000
10%
KES 24,001 – 32,333
KES 288,001 – 387,996
25%
KES 32,334 – 500,000
KES 387,997 – 6,000,000
30%
Above KES 500,000
Above KES 6,000,000
35%
After calculating PAYE from the brackets, employees subtract the personal relief of KES 2,400/month from the calculated tax. This relief is a fixed reduction in tax payable — not a deduction from taxable income. It effectively creates a near-zero-tax outcome for employees earning up to approximately KES 24,000/month (10% × 24,000 = KES 2,400 = personal relief).
Key note: Kenya’s PAYE starts at 10% from the first shilling (unlike Uganda and Tanzania which have a 0% band). The personal relief is what creates the effective zero-tax floor for low earners. Insurance relief (15% on qualifying life insurance premiums, up to KES 60,000/year) is also available to qualifying employees. Verify the latest rates at kra.go.ke.
Section 02
Worked Examples: PAYE at Common Salary Levels
The following examples show PAYE (after personal relief). SHA (2.75%), NSSF, and AHL (1.5%) are shown separately — all are calculated on gross salary independently and do not reduce the PAYE taxable base.
Example 1: KES 50,000/month
10% × KES 24,000 = KES 2,400
25% × KES 8,333 = KES 2,083
30% × KES 17,667 (KES 32,334–50,000) = KES 5,300
Gross PAYE: KES 9,783 − personal relief KES 2,400 = Net PAYE: KES 7,383/month
Effective PAYE rate on gross: 14.8%
SHA (2.75%): KES 1,375 | NSSF (~6% up to KES 18,000): KES 1,080 | AHL (1.5%): KES 750
Total deductions: approximately KES 10,588 | Net take-home: approximately KES 39,412/month
Example 2: KES 100,000/month
10% × KES 24,000 = KES 2,400
25% × KES 8,333 = KES 2,083
30% × KES 67,667 (KES 32,334–100,000) = KES 20,300
Gross PAYE: KES 24,783 − personal relief KES 2,400 = Net PAYE: KES 22,383/month
Effective PAYE rate on gross: 22.4%
SHA (2.75%): KES 2,750 | NSSF (capped): KES 1,080 | AHL (1.5%): KES 1,500
Total deductions: approximately KES 27,713 | Net take-home: approximately KES 72,287/month
Example 3: KES 200,000/month
10% × KES 24,000 = KES 2,400
25% × KES 8,333 = KES 2,083
30% × KES 167,667 (KES 32,334–200,000) = KES 50,300
Gross PAYE: KES 54,783 − personal relief KES 2,400 = Net PAYE: KES 52,383/month
Effective PAYE rate on gross: 26.2%
SHA (2.75%): KES 5,500 | NSSF (capped): KES 1,080 | AHL (1.5%): KES 3,000
Total deductions: approximately KES 61,963 | Net take-home: approximately KES 138,037/month
Use the Kenya tax calculator to run a personalised take-home pay figure for your exact salary.
Section 03
NSSF, SHA, and Affordable Housing Levy: Kenya’s Statutory Deductions
Kenyan employees face four separate statutory payroll deductions. Understanding all four is essential for an accurate take-home pay estimate:
1. NSSF — 6% of gross pensionable pay up to KES 18,000/month
Under the NSSF Act 2013, NSSF contributions operate in two tiers. Tier 1 covers the first KES 6,000 of pensionable pay (6% = KES 360/month maximum). Tier 2 covers pensionable pay from KES 6,001 up to the upper earnings limit of KES 18,000 (6% = up to KES 720/month). Combined maximum employee NSSF contribution: approximately KES 1,080/month. Employer matches at the same tiered rates. For employees earning above KES 18,000/month, the NSSF contribution is capped in practice at around KES 1,080/month.
2. SHA Levy — 2.75% of gross salary
The Social Health Authority (SHA) levy replaced NHIF from October 2023 under the Social Health Insurance Act 2023. The 2.75% rate applies to full gross salary with no cap. SHA covers the contributor and registered dependants at public and accredited private healthcare facilities. Unlike old NHIF (which had fixed monthly amounts by income band, max KES 1,700), SHA is fully proportional — higher earners pay substantially more for the same coverage base.
3. Affordable Housing Levy (AHL) — 1.5% of gross salary
Introduced under the Affordable Housing Act 2023, the AHL has been in force since July 2023. Employee rate: 1.5%; employer matches 1.5%. No income cap. Funds are directed to the Affordable Housing Fund for social housing construction. The AHL remains fully in force as of June 2026 despite litigation and the Finance Bill 2024 protests (which concerned separate proposed taxes).
Important: All deductions (PAYE, NSSF, SHA, AHL) are calculated on gross salary independently. NSSF does not reduce the PAYE base, and vice versa.
Section 04
KRA iTax: Filing and Compliance for Kenya Employees
KRA administers PAYE through the iTax platform. Key obligations:
Employer monthly filing deadline: PAYE returns must be filed and remitted by the 9th of the month following the payroll month. Late filing penalty: 25% of tax due or KES 10,000 (whichever is higher), plus 1% interest per month on outstanding tax.
Employee annual return: Employees with additional non-PAYE income must file an annual income tax return by 30 June for the preceding year. PAYE withheld is credited against the annual liability.
P9 Form: Employers issue a P9 form to each employee by 28 February showing total PAYE withheld for the previous year. Required documentation for annual returns and refund claims.
Tax Compliance Certificate (TCC): Required for passport renewals, work permit applications, and professional licences. Apply via iTax. Issued instantly if all returns are filed and tax is paid. Valid for 12 months.
SHA, NSSF, AHL: Remitted separately by employers to the respective bodies. Employees should confirm all deductions appear correctly on their payslips each month.
Section 05
Kenya PAYE vs Neighbouring Countries
Kenya’s PAYE burden is the highest in the EAC region when all statutory deductions are included. Key comparisons:
Top PAYE rate: Kenya 35% vs Tanzania 30% vs Ghana 30% vs Nigeria 24% vs Uganda 40%. Kenya’s 35% is high but not the highest in the region.
Additional levies: Kenya is unique in the EAC in requiring SHA (2.75%), AHL (1.5%), and NSSF simultaneously. Tanzania and Uganda require only NSSF. Nigeria requires pension (8%) and NHF (2.5%) but not health and housing levies combined.
Effective rate at KES 100,000/month: PAYE alone = 22.4%, but total statutory deductions including SHA, NSSF, and AHL bring the total effective deduction to approximately 27.7% of gross. This is higher than Tanzania’s combined PAYE + NSSF at TZS 1.5M/month (approximately 28.5%).
Personal relief vs tax-free threshold: Kenya’s personal relief (KES 2,400/month offset against tax) is structurally different from Uganda and Tanzania’s zero-rate bands. The effect is the same at the bottom end, but the mechanism differs.
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PAYE (Pay As You Earn) is Kenya’s system of withholding personal income tax from employees’ salaries at source. Employers calculate PAYE each month using KRA’s progressive brackets, deduct the tax (less personal relief of KES 2,400/month), and remit to KRA by the 9th of the following month. Governed by the Income Tax Act (Cap 470) and administered by the Kenya Revenue Authority via the iTax platform. PAYE covers all employment income including salary, allowances, and benefits in kind.
Q
What is the personal relief in Kenya and how does it work?
Kenya’s personal relief is KES 2,400/month (KES 28,800/year). It is deducted from the tax calculated using the PAYE brackets — not from taxable income. All resident employees receive it automatically. Its effect is that employees earning up to KES 24,000/month pay zero net PAYE (10% × KES 24,000 = KES 2,400 = exactly equal to personal relief), creating an effective tax-free floor at that income level.
Q
How do I calculate my Kenya PAYE?
To calculate Kenya PAYE: (1) Apply monthly brackets to gross salary: 10% on KES 0–24,000; 25% on KES 24,001–32,333; 30% on KES 32,334–500,000; 35% above KES 500,000. (2) Sum the tax from each applicable band. (3) Subtract personal relief of KES 2,400 to get net PAYE payable. (4) Also separately calculate SHA (2.75%), NSSF (6% up to KES 18,000/month), and AHL (1.5%) on gross salary. Use the Kenya tax calculator at /tax-calculator/kenya/ for an instant result.
Q
What is the SHA levy in Kenya?
The Social Health Authority (SHA) levy replaced NHIF from October 2023 under the Social Health Insurance Act 2023. The rate is 2.75% of gross salary with no income cap. SHA covers the contributor and registered dependants at public and accredited private healthcare facilities. Unlike old NHIF which had fixed monthly amounts by income band (maximum KES 1,700), SHA is proportional — higher earners pay significantly more for the same base coverage.
Q
Was the Affordable Housing Levy removed after the 2024 protests?
No. The Affordable Housing Levy (1.5% of gross salary) remains fully in force as of 2026. It was introduced by the Affordable Housing Act 2023 and upheld as constitutional. The Finance Bill 2024 — which was withdrawn after mass protests in June 2024 — proposed separate tax measures and did not cover the AHL (which was already in force under different legislation). Employees should confirm the 1.5% AHL deduction appears correctly on their payslips.
Q
What is Kenya’s top income tax rate?
Kenya’s top PAYE rate is 35%, applying to monthly income above KES 500,000 (KES 6,000,000/year). This is among the higher statutory top rates in East Africa, above Tanzania (30%) and Nigeria (24%), but below Uganda (40%). The 35% rate applies only to income above the KES 500,000/month threshold — not to the entire salary.
Q
When is Kenya’s tax year?
Kenya’s tax year runs January 1 to December 31 (calendar year). Monthly PAYE returns are due by the 9th of the following month. Annual income tax returns for employees with non-PAYE income are due by 30 June of the following year. The P9 PAYE summary form must be issued to all employees by 28 February.
Q
How does NSSF work in Kenya under the 2013 Act?
Under the NSSF Act 2013, contributions are 6% of pensionable pay across two tiers. Tier 1 covers the Lower Earnings Limit (KES 6,000/month): 6% employee = KES 360/month. Tier 2 covers pensionable pay from KES 6,001 up to the Upper Earnings Limit of KES 18,000/month: 6% of up to KES 12,000 = up to KES 720/month additional. Combined employee maximum: approximately KES 1,080/month. For most employees earning above KES 18,000/month, the total NSSF contribution is capped at around KES 1,080/month, far lower than the uncapped systems in Tanzania and Uganda.
Disclaimer:This guide provides general PAYE tax information for Kenya based on 2026 published rates from the Kenya Revenue Authority. The Affordable Housing Levy and SHA levy remain in force as of the date of this guide. PAYE brackets, NSSF rates, SHA rates, and filing deadlines are subject to change by Finance Acts and KRA administrative circulars. Consult a qualified Kenyan tax professional or verify current rates at kra.go.ke for advice specific to your situation.