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PAYE Tax Rules

This a list of Kenya’s PAYE Tax Rules that Nifty Payroll incorporates in its payslip calculations.

Mandatory deductions, and employee-related employer obligations, are also incorporated, listed below the tax rules.

Benefits (Added to Gross Pay to get Taxable Pay)

– Other (Electricy, water, furniture, phone) – Read more
– Car – Read more
– Housing – Read more

Alloweds (Reliefs that are deducted from Gross Pay to get Taxable Pay)

– Pension – Read more
– Home (Owner Occupied Interest) – Read more
– Persons with Disability – Read more

Reliefs (Reliefs that are deducted from Calculated Gross PAYE Tax)

– Personal – Read more
– Insurance (including NHIF) – Read more
– Affordable Housing – Read more

Other Payments and Benefits

– Medical / Passages (There are rules for when to tax these) – Read more
– Lumpsum Payments (There’s a formula for calculating this tax) – Read more

Special Circumstances

– Non-Residents (Aren’t allowed tax reliefs) – Read more
– Secondary Employment (Are taxed at the highest rate. Aren’t allowed tax reliefs) – Read more

Mandatory Deductions

– National Hospital Insurance Fund (NHIF) – Read more
– National Social Security Fund (NSSF) – Read more

Employer Obligations

(These items are not  employee deductions; they are employee-related obligations to be paid by the employer.)

– Low Interest Rate Benefit (Fringe Benefit Tax) – Read more
– Industrial Training Levy (NITA) – Read more