What is Insurance Relief in Kenya?

Insurance Relief is 15% of premiums paid for Life, Health, or Education policies, capped at KES 5,000 per month. This reduces the final PAYE amount payable to KRA.

How is SHIF calculated?

SHIF is calculated at a flat rate of 2.75% of your gross monthly salary with no upper limit applied.

When is the deadline to pay PAYE to KRA?

PAYE must be filed and paid to KRA by the 9th day of the following month to avoid penalties and interest.

Expert Verified by Patrick Buyela, Payroll Consultant · Updated March 2026

KRA PAYE Calculator Kenya (2026)

Ensure 100% compliance with our advanced PAYE Calculator Kenya. Instantly compute your monthly income tax, including the latest SHIF deductions and updated NSSF Phase 4 Tier limits.

Income Details

Monthly Gross Salary (KES)

KES

Note: Gross salary includes basic pay plus all regular cash allowances. Refer to the Official KRA PAYE Guide for taxable benefits.

Tax Summary Breakdown

Gross Salary

KES 0

NSSF ContributionPhase 4 Limit applied

- KES 0

Affordable Housing Levy1.5% Employee Portion

- KES 0

SHIF Deduction2.75% of Gross Pay

- KES 0

Taxable Pay Amount subject to PAYE

KES 0

PAYE Tax (Before Relief)

KES 0

Personal ReliefStatutory KRA allowance

- KES 2,400

Final PAYE Deducted

KES 0

Estimated Net Take-Home Pay

KES 0

How KRA PAYE Calculation Works in 2026

Pay As You Earn (PAYE) is a statutory tax deducted from an employee's salary in Kenya and remitted to the Kenya Revenue Authority (KRA). The system is progressive, governed by the Finance Act and recent amendments including the Social Health Insurance Act.

The Calculation Sequence

To find your net salary using our PAYE Calculator Kenya, we follow these legal steps:

Gross Income: Your basic salary plus regular allowances (commuter, house, bonuses).
Taxable Pay: Gross Salary minus allowable deductions like NSSF contributions.
Gross Tax: Applying the progressive KRA bands to your taxable pay.
Final PAYE: Gross Tax minus Personal Relief (KES 2,400) and other applicable reliefs.

Official 2026 KRA PAYE Tax Bands

Monthly Taxable Income (KES)	Tax Rate (%)
Up to 24,000	10%
24,001 - 32,333	25%
32,334 - 500,000	30%
500,001 - 800,000	32.5%
Above 800,000	35%

Statutory Deductions and Levies

Your net pay is impacted by three other mandatory deductions enacted under Kenyan law:

1. SHIF (Social Health Insurance Fund)

The SHIF deduction is 2.75% of your gross salary with no maximum limit. Use our SHIF Calculator for precise results.

2. NSSF (National Social Security Fund)

Contributions are tiered. For 2026, the Phase 4 contribution limits apply, capping the deduction at a higher pensionable limit than previous years.

3. Affordable Housing Levy

A mandatory 1.5% deduction from your gross salary, which is matched equally by your employer.

PAYE Kenya: Frequently Asked Questions

1. What is the tax-free salary limit in Kenya for 2026?

Individuals earning a taxable income of KES 24,000 or less per month pay zero PAYE. This is because the 10% tax on the first KES 24,000 equals KES 2,400, which is exactly offset by the monthly Personal Relief of KES 2,400.

2. How does Mortgage Interest reduce my PAYE?

If you have a mortgage for your primary residence from a registered financial institution, you can claim Mortgage Interest Relief. Interest paid up to KES 25,000 per month (KES 300,000 annually) is deducted from your gross income before tax is calculated, significantly lowering your taxable pay.

3. What is Insurance Relief and how is it calculated?

Insurance Relief is granted to residents who pay premiums for Life, Health (SHIF), or Education policies. It is calculated as 15% of the premiums paid, subject to a maximum cap of KES 5,000 per month (KES 60,000 annually). This relief is subtracted directly from your calculated PAYE tax.

4. Are bonuses, overtime, and commissions taxable?

Yes. Under KRA regulations, all cash payments including bonuses, commissions, overtime pay, and car/house allowances are considered part of your gross income and are subject to progressive PAYE rates.

5. What happens if I have more than one employer?

If you have multiple employers, you are only entitled to claim Personal Relief from one employer. You must notify your secondary employer(s) not to apply relief, otherwise, you will have an underpayment of tax at the end of the year which attracts penalties on the iTax Portal.

6. Is the Affordable Housing Levy a tax or a deduction?

It is a statutory levy. Unlike NSSF, it is currently not treated as an allowable deduction for PAYE purposes. This means it is calculated on your gross pay, but it does not reduce the taxable pay used to calculate your PAYE tax.

7. When is the deadline for PAYE remittance?

Employers must file and remit PAYE through iTax by the 9th day of the following month. Late payments attract a penalty of 5% of the tax due and interest of 1% per month.