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How to Calculate Your 2024 Net Pay in Kenya

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Published Date
Jan 3, 2024
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Last edited time
Mar 27, 2024 05:20 PM
Your 2024 Guide: How to Accurately Calculate Net Income in Kenya
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Your net pay, or take-home pay, is the amount of money you actually receive in your paycheck after taxes and other deductions. Calculating your net income accurately is important for budgeting and financial planning. In Kenya, net pay is determined by your gross salary and various statutory deductions like PAYE tax, NHIF, NSSF contributions, and housing levy. This guide will walk you through exactly how net pay is calculated in Kenya.

Gross Pay

Your gross pay refers to your total earnings before any deductions are taken out of your paycheck. This includes your basic salary plus any overtime pay, commissions, bonuses, or other taxable pay. The amount of your gross pay directly impacts how much you will take home after deductions. Generally, the higher your taxable gross pay, the higher your statutory contributions.
Some key factors that influence your gross pay in Kenya include:
  • Basic salary - This is the main component that makes up your gross pay. Any increases to basic salary will increase gross pay.
  • Allowances - Standard allowances like housing, commuter, entertainment, responsibility, and uniform allowances are taxable and added to gross pay.
  • Overtime Pay - Any overtime hours worked are considered part of your taxable gross pay. The more OT you work, the higher your gross.
  • Bonuses & Commissions - Productivity and performance bonuses are fully taxable and contribute to higher gross salary.
By understanding all the components that are included in gross salary, you can accurately calculate deductions to determine net pay.

Deductions from Gross Pay

Once gross salary is determined, the next step is calculating deductions. There are several statutory deductions mandated by the Kenya government that are subtracted from your gross pay:


PAYE (Pay As You Earn) tax is calculated as a percentage of gross pay, minus personal tax relief, according to income tax bands published by KRA annually. Higher gross incomes fall under higher PAYE tax rates. The current highest rate is 30% for those earning over KSH 569,000 per month.


This national health insurance is mandatory for all employees. NHIF is calculated based on a tiered system up to a maximum of KSH 1,700 per month. Higher earners pay higher NHIF so this deduction increases directly with gross pay increases.
The Social Health Insurance Fund (SHIF) in Kenya which is set to replace NHIF is calculated differently from the previous NHIF system. SHIF contributions are 2.75% of an individual’s gross earnings with a minimum contribution of KSH 300 per month.


NSSF contributions are set at 6% of gross pay capped at KSH 200 per month currently. Employers match this 6% contribution. Higher incomes hit the KSH 200 monthly max faster.

Housing Levy

The housing levy became effective on 1 July 2023. A 1.5% housing levy is deducted from gross pay for salaries above KSH 13,000 per month. This funds affordable housing. Higher gross pay contributes more to this levy until the KSH 5,000 monthly cap is reached. However, its legality was challenged, leading to a temporary suspension which was lifted. All employers are required to deduct affordable housing levy (AHL) with effect from 19th March 2024.

Calculate Your Net Pay

The harder part is accurately determining each of those line items based on your specific salary components and deductions.
Rather than doing complex tax computations manually, I recommend using our free online Net Pay Calculator to automatically compute your net salary after all deductions.


Calculating net income in Kenya involves accounting for gross taxable salary including allowances, benefits, and variable pay, and then subtracting fixed statutory deductions like PAYE, NHIF, NSSF, and housing levy based on income bands. Our net pay calculator does all the heavy lifting for you to estimate your take-home pay.
I highly recommend plugging your salary details into the tool so you know exactly what to expect from your payslip. Understanding your net income will empower you to budget smarter and maximize savings.

Last edited on Wed Mar 27 2024