Insights
PAYE in Kenya: Tax Bands, NSSF, SHIF and the Housing Levy
Insights · By Chen ChunJie · Published 8 November 2026
Every employer in Kenya withholds PAYE from salaries and pays NSSF, SHIF and the Affordable Housing Levy each month. The Finance Act 2026 left the PAYE bands unchanged, but the NSSF ceiling rose in February 2026. This guide sets out the 2026 rates, the order in which deductions are applied, the deadlines and a worked example.
Last reviewed in November 2026 against the Employment Act 2007, the Regulation of Wages Orders of May 2026, the NSSF Act, the Social Health Insurance Act, the Affordable Housing Act and KRA guidance. Rates and limits change, so we confirm them for each engagement.
PAYE bands for 2026
| Monthly taxable pay (KES) | Rate |
|---|---|
| Up to 24,000 | 10% |
| 24,001 to 32,333 | 25% |
| 32,334 to 500,000 | 30% |
| 500,001 to 800,000 | 32.5% |
| Above 800,000 | 35% |
Each employee gets personal relief of KES 2,400 a month, deducted from the tax calculated. Annual equivalents are twelve times these figures.
Deductions taken before PAYE
Since the Tax Laws (Amendment) Act 2024, the employee’s NSSF contribution, SHIF and Housing Levy are deducted from gross pay before PAYE is calculated. Contributions to a registered pension scheme, including NSSF, are allowable up to KES 30,000 a month.
Statutory contributions and levies
| Item | Rate | Paid by | Deadline |
|---|---|---|---|
| NSSF | 6% each on pensionable pay up to KES 108,000 a month from February 2026; at most KES 6,480 each | Employer and employee | 9th of the following month |
| SHIF | 2.75% of gross pay, minimum KES 300 | Employee, deducted by the employer | 9th of the following month |
| Affordable Housing Levy | 1.5% of gross pay each, no cap | Employer and employee | Within nine working days after month end |
| NITA levy | KES 50 per employee a month | Employer | 9th of the following month |
| PAYE | Monthly bands above | Employee, withheld by the employer | 9th of the following month |
Have a Kenyan company and want this done every month? See Payroll Outsourcing in Kenya. No company yet? See Employer of Record in Kenya.
Worked example: KES 150,000 a month
| Line | KES |
|---|---|
| Gross salary | 150,000.00 |
| Employee NSSF | 6,480.00 |
| SHIF (2.75%) | 4,125.00 |
| Housing Levy (1.5%) | 2,250.00 |
| Taxable pay | 137,145.00 |
| Tax before relief | 35,926.85 |
| Personal relief | 2,400.00 |
| PAYE | 33,526.85 |
| Net pay | 103,618.15 |
| Employer NSSF, Housing Levy and NITA | 8,780.00 |
| Total employer cost, before work-injury insurance | 158,780.00 |
Try other salaries in our Kenya salary calculator.
Year-end and filing
PAYE is filed monthly on iTax. By the end of February the employer gives each employee a P9 card showing pay and tax for the previous year, which the employee uses for their own return. The Finance Act 2026 moves the individual return deadline from 30 June to 30 April, with effect from 1 January 2027. It also exempts gratuity contributions to a registered scheme from 1 July 2026, for contracts of at least three years and within a 31% limit.
FAQ: PAYE in Kenya
When is PAYE due in Kenya?
By the 9th of the month after the salary is paid.
What is personal relief in Kenya?
KES 2,400 a month, deducted from the tax calculated.
Are SHIF and the Housing Levy tax-deductible?
Yes. Both are deducted from gross pay before PAYE is calculated.
What is the maximum NSSF contribution in 2026?
KES 6,480 a month each for employer and employee, from February 2026.
Hiring your first employee in Kenya?
Our Local Team employs the person, runs payroll, PAYE, NSSF, SHIF and the Housing Levy, and handles the paperwork, while you manage the day-to-day work.
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