PAYE in 2026 runs from 10% on the first KSh 24,000 of monthly taxable pay to 35% above KSh 800,000, with a personal relief of KSh 2,400 a month. Before PAYE, your employer deducts SHIF at 2.75%, the Affordable Housing Levy at 1.5% and NSSF at 6% up to the KSh 108,000 upper limit. The Finance Act 2026 did not change the PAYE bands or the relief.
PAYE bands 2026
| Monthly taxable pay | Rate |
|---|---|
| First KSh 24,000 | 10% |
| KSh 24,001 to KSh 32,333 | 25% |
| KSh 32,334 to KSh 500,000 | 30% |
| KSh 500,001 to KSh 800,000 | 32.5% |
| Above KSh 800,000 | 35% |
Personal relief is KSh 2,400 a month (KSh 28,800 a year) for resident individuals. Insurance relief is 15% of qualifying premiums, up to KSh 5,000 a month. Non-residents pay the same bands but get no personal relief.
Statutory deductions on a payslip
| Deduction | Employee rate | Notes |
|---|---|---|
| SHIF (Social Health Insurance Fund) | 2.75% of gross | Minimum KSh 300 a month, no upper cap. Deducted before PAYE. |
| Affordable Housing Levy | 1.5% of gross | Employer pays a matching 1.5%. Deducted before PAYE. |
| NSSF Tier I | 6% up to KSh 9,000 | Maximum KSh 540 a month, matched by the employer. |
| NSSF Tier II | 6% from KSh 9,000 to KSh 108,000 | Maximum KSh 5,940 a month, matched by the employer. |
The NSSF limits are Year 4 of the NSSF Act phase-in, in force from February 2026. Limits after Year 4 are to be set by Gazette Notice; none had been published when we checked on 25 October 2026.
Worked example: KSh 100,000 a month
- NSSF: KSh 6,000
- SHIF: KSh 2,750
- Housing Levy: KSh 1,500
- Taxable pay: KSh 89,750
- PAYE: KSh 21,708 less KSh 2,400 relief = KSh 19,308
- Take-home: KSh 70,442
Run your own figure in the PAYE and net salary calculator, or check single deductions with the NSSF, SHIF and Housing Levy calculators.
Other headline KRA rates
| Tax | Rate | Who and when |
|---|---|---|
| VAT (general rate) | 16% | Taxable goods and services. Zero-rated supplies are 0%. Registration is required at KSh 5 million a year in taxable supplies. KRA, Value Added Tax |
| Turnover tax (TOT) | 1.5% of gross sales | Resident businesses with turnover above KSh 1 million and not above KSh 25 million a year. Filed and paid by the 20th of the next month. KRA, Turnover Tax |
| Monthly residential rental income (MRI) | 7.5% of gross rent | Resident landlords with residential rent above KSh 280,000 and not above KSh 15 million a year. Final tax, due by the 20th of the next month. KRA, Rental Income Tax |
| Withholding tax on bank interest | 15% | Residents and non-residents. A final tax on qualifying interest for residents. KRA, Withholding Tax |
| Withholding tax on dividends | 10% resident, 15% non-resident | Resident companies holding more than 12.5% of the payer pay nil. A final tax for residents on qualifying dividends. KRA, Withholding Tax |
| Withholding tax on professional and management fees | 5% resident, 20% non-resident | Deducted by the payer. Not a final tax for residents: declare the income and claim the certificate in your return. KRA, Withholding Tax |
Tools for these: VAT calculator, turnover tax calculator, rental income tax calculator and withholding tax calculator. Not sure which regime you are in? Read turnover tax vs rental income vs income tax.
Frequently asked questions
Did the Finance Act 2026 change PAYE rates?
No. KRA's own summary of the Finance Act 2026 lists no change to the PAYE bands or the personal relief. The bands run from 10% to 35% and relief is KSh 2,400 a month.
What are the NSSF rates in 2026?
From February 2026 (Year 4 of the NSSF Act phase-in) the lower earnings limit is KSh 9,000 and the upper earnings limit is KSh 108,000. The employee pays 6%: Tier I up to KSh 540 and Tier II up to KSh 5,940, a maximum of KSh 6,480 a month, matched by the employer.
Is SHIF deducted before PAYE?
Yes. Since December 2024, SHIF contributions and the Affordable Housing Levy are deducted from pay before PAYE is worked out, according to KRA.
How much PAYE is paid on KSh 100,000?
KSh 19,308 a month, after NSSF of KSh 6,000, SHIF of KSh 2,750 and the Housing Levy of KSh 1,500 come off first. Take-home is about KSh 70,442.
Sources
- KRA, Pay As You Earn (PAYE): bands, personal relief, Housing Levy rate, allowable deductions. Read 25 October 2026.
- KRA, Individual Income Tax: bands, reliefs, late filing penalty. Read 25 October 2026.
- KRA public notice, 19 December 2024: SHIF and Housing Levy deductible before PAYE from December 2024.
- KRA, Finance Act 2026: What It Means for You: no PAYE band or relief change listed. Read 25 October 2026.
- Social Health Authority, premium rates: SHIF at 2.75% of gross, minimum KSh 300. Read 25 October 2026.
- PwC Kenya tax alert, January 2026 and KPMG Kenya, February 2026: NSSF Year 4 limits. We could not open NSSF's own notice, so these two firms are the source.
- KRA pages for VAT, turnover tax, rental income and withholding tax. Read 25 October 2026.
Related
Related reading
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