PAYE stands for Pay As You Earn. It is a tax on employment income. Employers deduct it from employees' salaries each month. Then they remit it to the Kenya Revenue Authority (KRA).
This system ensures regular tax collection. Consequently, employees pay tax gradually. Moreover, it prevents large tax bills at year-end. Therefore, it benefits both taxpayers and the government.
A PAYE calculator helps you determine your monthly tax. Firstly, it calculates the tax on your gross salary. Secondly, it deducts the tax and other statutory deductions. Thus, you get your net take-home pay. Also, it helps in financial planning. Moreover, it ensures you pay the right tax. Finally, it prevents surprises during tax filing. Therefore, it is essential for every employee in Kenya.
Our calculator is the most accurate and easy-to-use tool available. Unlike others, it includes all statutory deductions and reliefs.
Our calculator follows these steps: First, it subtracts NSSF from your gross salary. Then it calculates annual taxable income. Next, it applies KRA tax bands. After that, it subtracts personal relief. Finally, it deducts NHIF to get your net salary.
The PAYE calculation uses progressive tax bands:
Taxable Income = Gross Salary - NSSF Contribution
Annual Taxable Income = Taxable Income × 12
Then apply tax bands:
Monthly Tax = (Annual Tax ÷ 12) - Personal Relief
Net Salary = Gross Salary - PAYE Tax - NSSF - NHIF
| Annual Income (KSh) | Monthly Income (KSh) | Tax Rate | Deduction (KSh) |
|---|---|---|---|
| 0 - 288,000 | 0 - 24,000 | 10% | - |
| 288,001 - 388,000 | 24,001 - 32,333 | 25% | 28,800 |
| 388,001+ | 32,334+ | 30% | 38,800 |
Our calculator simplifies tax computation. First, it determines your taxable income. Then it applies Kenya's progressive tax rates. After that, it subtracts statutory deductions. Finally, it provides your net salary. This process ensures accuracy. Moreover, it follows KRA guidelines. Therefore, you get reliable results. Additionally, it updates with current rates. Consequently, you always have correct calculations.
The personal relief is KSh 2,400 per month. This amount is deducted from your calculated tax. It reduces your tax liability. Therefore, it increases your take-home pay.
Yes, NSSF contributions are tax-exempt. Currently, the maximum contribution is KSh 1,080 per month. This amount is deducted before calculating taxable income. Therefore, it reduces your tax liability.
You should calculate PAYE monthly. Especially when your salary changes. Also, when tax rates change. Our calculator helps with this. Consequently, you can budget accurately.
Gross salary is your total earnings. Net salary is what you receive after deductions. These include PAYE, NSSF, and NHIF. Therefore, net pay is always less than gross.
Employers must remit PAYE by the 9th of the next month. For example, January PAYE is due by February 9th. Late payments attract penalties. Therefore, timely payment is essential.