If you earn a monthly salary of 20000 here is a simple breakdown of how much KRA and other statutory bodies take before your money reaches your account This is based on the current rules used in Kenya and a practical example you can follow step by step
Understanding the Basics
When you receive a salary your employer must deduct several statutory amounts before paying you These include income tax known as PAYE and other deductions such as NSSF SHIF and the housing levy These deductions reduce your taxable income before KRA calculates any tax
Step by Step Example for a 20000 Salary
Gross monthly salary 20000
Step 1 Statutory deductions before tax
NSSF small deduction depending on terms
SHIF 275 percent of gross pay which is 550
Housing levy 15 percent of gross pay which is 300
After these deductions your taxable income is roughly
20000 minus 550 minus 300 minus NSSF
This leaves you with an estimated taxable income of about 19000
Step 2 Calculating PAYE
The first 24000 of income is taxed at 10 percent
Your taxable income is below 24000 so the tax before any relief becomes
10 percent of 19000 which is 1900
Step 3 Applying personal relief
Every employee in Kenya receives personal relief of 2400
Since your calculated tax is 1900 which is lower than the relief your PAYE becomes zero
This means you do not pay any income tax on a 20000 salary
Step 4 Total deductions and final take home
PAYE 0
SHIF 550
Housing levy 300
NSSF small deduction
Your total deductions range between 850 and 1000
Your final take home pay is about 19000
What This Means
At a salary of 20000 your income is too low to attract PAYE once personal relief is applied
The only amount you lose is through statutory deductions
Your employer must still file PAYE even when the tax due is zero
Your payslip should clearly show personal relief and all deductions
Why This Matters
Many Kenyans earning around 20000 assume they are taxed heavily but in most cases they pay zero PAYE Understanding your deductions helps you spot payroll errors plan your money correctly and confirm that your employer is compliant with KRA rules
If you’re ready to simplify payroll, stay compliant, or just need expert HR support, reach out anytime — call 254 702 339 699 or email sales@faidihr.com.