Congratulations! You landed that job and negotiated a decent salary—say, around KES 80,000 a month. When payday finally comes, you eagerly wait for that SMS alert from your bank. It pops up, but hold on, the figure is way lower than you expected. You’re left scratching your head, wondering, “Where did my money disappear to?”
Trust me, you’re not alone. Almost every Kenyan worker goes through this confusion at some point. The difference between your gross salary and what actually hits your account (your net pay) can be puzzling. But in 2025, there’s no need to be in the dark. Your payslip isn’t just a random paper—it’s a record of your hard work and your responsibilities as a citizen.
So, What’s Really on Your Payslip?
This guide breaks down what’s on a typical Kenyan payslip. We’ll look at the mandatory deductions—PAYE for the Kenya Revenue Authority (KRA), your pension contributions to the NSSF, and your new health insurance payments under the SHIF. By the end, you’ll know exactly where your money is going and why.
The Basics: Gross, Taxable, and Net Pay
Before we jump into deductions, let’s get three main terms out of the way:
- Gross Salary: This is what you agreed on with your employer before any deductions. It includes your basic pay plus allowances like house or transport.
- Taxable Pay: The part of your pay that’s actually used to calculate your income tax (PAYE). Some amounts, like your NSSF contributions, are taken off first before tax is calculated.
- Net Salary: This is your take-home pay. It’s what finally lands in your account after all deductions have been made.
The Big Three Statutory Deductions
1. PAYE – Your Income Tax
PAYE stands for “Pay As You Earn.” This is the income tax your employer deducts every month and sends straight to KRA. If you earn more than KES 24,000 a month, you’re required by law to pay PAYE.
In 2025, Kenya uses progressive tax rates. This means the more you earn, the higher the tax rate on the extra bit. Here’s a quick look:
- On the first KES 24,000 – taxed at 10%
- On the next KES 8,333 – taxed at 25%
- On amounts above KES 32,333 – taxed at 30%
- If you’re a high earner (over KES 500,000), rates can go up to 35%
You also get reliefs, like the personal relief of KES 2,400 every month and insurance relief of 15% on your insurance premiums (capped at KES 5,000). This helps lower your tax a bit.
2. NSSF – Your Pension Savings
This is money put aside for your retirement, managed by the National Social Security Fund (NSSF). Both you and your employer chip in. The rates are 6% each on your pensionable pay, split into two tiers:
- Tier I: Earnings up to KES 7,000 – you pay up to KES 420.
- Tier II: From KES 7,001 to KES 36,000 – up to KES 1,740.
The maximum you pay is KES 2,160, which your employer matches. Not bad for your future, eh?
3. SHIF – Your Health Insurance
Say goodbye to NHIF. Now we have the Social Health Insurance Fund (SHIF). Under this new system, you contribute 2.75% of your gross salary. This goes towards covering your hospital bills and ensuring you and your dependents can access healthcare when needed.
Putting It All Together: Sample Payslip
Meet Joyce. She earns KES 60,000 gross per month. Here’s how her deductions might look in 2025:
| Description | Amount (KES) |
|---|---|
| Gross Salary | 60,000.00 |
| NSSF (Tier I + II) | (2,160.00) |
| SHIF (2.75% of Gross) | (1,650.00) |
| Affordable Housing Levy (1.5%) | (900.00) |
| PAYE | (9,600.35) |
| Total Deductions | (14,310.35) |
| Net Pay (Take-Home) | 45,689.65 |
Other Deductions You Might See
- HELB: If you benefited from a HELB loan for your university education, deductions start once you’re employed.
- SACCO: Maybe you joined a SACCO to save or took a SACCO loan. These payments come out here too.
- Company Deductions: This could be for a salary advance, staff welfare contributions, or repayments for a company asset.
Frequently Asked Questions
Can I stop my employer from making these deductions?
Nope. PAYE, NSSF, SHIF, and the Housing Levy are all mandatory under Kenyan law. Your employer is simply following the rules.
How do I know my employer actually remits my NSSF or SHIF?
For NSSF, check your statement on the NSSF Self-Service portal. SHIF is still rolling out, but soon you’ll use the Social Health Authority (SHA) portal to confirm payments.
What’s this Housing Levy all about?
It’s 1.5% of your gross pay, matched by your employer. It funds the government’s Affordable Housing Program.
Why do I need a P9 form?
At the end of the year, your employer gives you a P9 form summarizing your total pay and deductions. You’ll use it to file your annual KRA returns.
Bottom Line
Your payslip tells the story of your money—what you earned, what went to taxes, your pension, your health, even your future house. Taking time to understand it helps you budget better, plan for tomorrow, and make sure everything adds up. Stay informed, keep an eye on your statements, and secure that financial peace of mind.