A Complete Kenyan Payroll Deduction Stack for 2026
Understanding Your Payslip
Navigating payroll in Kenya requires understanding how statutory deductions transform Gross
Salary into Net Take-Home Pay. Employers are legally obligated to calculate, withhold, and remit statutory contributions by their statutory due dates.
Gross pay: is everything you earn before anything is taken out.
Net Pay: is what lands in your bank account after the deductions.
The Four Main Deductions
1. NSSF (your retirement savings). 6% of your pay goes to NSSF, and your employer adds another 6% on top. It only counts pay up to KES 108,000, so the most you'll ever pay is KES 6,480 a month. This money is taken out before tax is worked out, so it lowers your tax.
2. SHIF (health cover, formerly NHIF). 2.75% of your gross salary. The minimum is KES 300 a month, and there is no maximum, so the more you earn, the more you pay. You pay all of it; your employer doesn't add anything
3. Housing Levy. 1.5% of your gross salary, and your employer matches it with another 1.5%. It
also lowers your tax.
4. PAYE (income tax). After NSSF, SHIF and Housing Levy are taken out, the rest of your pay is taxed. But it isn't all taxed at one rate. It's taxed in slices, and each slice has its own rate:
From 0 to 24,000 -10%
From 24,001 to 32,333 - 25%
From 32,334 to 500,000 - 30%
From 500,001 to 800,000 - 32.5%
Anything above 800,000 - 35%
Key dates to remember
Every month:
9th: PAYE, NSSF and SHIF must be filed and paid for the previous month.
9th working day: Housing Levy is due. Weekends and public holidays don't count, so this is often a few days after the 9th.
Every year:
February: NSSF limits are usually reviewed. Check your payroll settings before the February run.
Employers should give employees their P9 forms.
30 June: Deadline for employees to file their annual tax returns on iTax.
That's where the right tools make a difference. Kiotapay HR & Payroll keeps up with the latest statutory rates, calculates every deduction correctly, and lets you pull reports with the filters you need: by month, employee, or deduction type.
For more information, visit kiotapay.co.ke
Reach out on info@kiotapay.com
