# Kenya Payroll for Foreign Employers: Costs, Dates

> How payroll works in Kenya for foreign employers: employer contributions, PAYE, NSSF, SHIF, Housing Levy and NITA, filing dates, payslips and paying staff.

Original page: https://cazini.co.ke/guides/kenya-payroll-foreign-employers  
Updated: 2026-11-03 · Cazini (Paul Omondi)

Kenyan payroll has two parts: **deductions** you take from each employee's pay - PAYE, NSSF, SHIF and the Affordable Housing Levy - and **employer contributions** you pay on top - NSSF, the Housing Levy and the NITA training levy. You remit them each month, give every employee a **payslip**, and issue a **P9** tax card after the year ends.

This guide is for foreign companies, investors and employers of record running payroll in Kenya for the first time.

## What you deduct and what you pay

The rates below come from the same configuration Cazini's payroll uses:

| Deduction | Employee | Employer |
| --- | --- | --- |
| NSSF | 6% of pay up to KES 108,000 (max KES 6,480) | 6%, same limit |
| SHIF | 2.75% of gross pay, minimum KES 300 | None |
| Affordable Housing Levy | 1.5% of gross pay | 1.5% of gross pay |
| PAYE | Banded, on taxable pay (see above) | None (the employer remits it) |

*Rates last verified 2026-10-16.*

On top of these, employers pay the **NITA training levy** under the Industrial Training Act, widely reported as **KES 50 per employee per month**. Register with the National Industrial Training Authority (NITA) and pay it as NITA directs.

For the full breakdown of each deduction, see [Kenya statutory deductions](https://cazini.co.ke/guides/kenya-statutory-deductions).

## What an employee costs

For budgeting, an employee's cost to you is their **gross pay**, plus your **NSSF** contribution, your **Housing Levy** contribution and the **NITA levy**, plus any benefits you choose to offer, such as medical cover, a pension top-up or allowances. PAYE and SHIF come out of the employee's gross pay, so they do not add to your cost.

Here is how a gross salary of KES 50,000 a month works out for the employee:

| Monthly gross KES 50,000 | KES |
| --- | --- |
| NSSF (employee) | 3,000 |
| SHIF | 1,375 |
| Housing Levy (employee) | 750 |
| Taxable pay | 44,875 |
| PAYE (after relief) | 5,846 |
| Net pay | 39,029 |

[Kenya PAYE calculator](https://cazini.co.ke/tools/kenya-paye-calculator) - work out net pay and every deduction for any salary.

## Filing and payment dates

| Remittance | Paid to | Due |
| --- | --- | --- |
| PAYE | KRA, through iTax | By the 9th of the following month |
| SHIF | Social Health Authority | By the 9th of the following month |
| Affordable Housing Levy | KRA, through iTax | By the 9th of the following month |
| NSSF | NSSF | Monthly - confirm the current due date on the NSSF employer portal |
| NITA levy | National Industrial Training Authority | As NITA directs |

*Late payment attracts penalties and interest. Published guides disagree on the NSSF and NITA due dates, so confirm them with the agency.*

Each month, the sequence is the same: calculate payroll, pay salaries, file the PAYE return on iTax, and remit every deduction and contribution by its due date. Keep the payroll records - the law requires employers to keep records of wages paid.

## Payslips, P9s and records

- **Payslips:** give every employee a written statement of their pay each month, showing gross pay and each deduction.
- **P9:** after the tax year ends, give each employee a P9 form showing their annual pay and PAYE, which they use to file their own tax return.
- **Records:** keep payroll, leave and contract records for every employee.

## Things foreign employers often miss

- **Housing.** The Employment Act requires employers either to provide reasonable housing or to pay a sufficient rent allowance, **unless** the contract consolidates a housing element into the basic salary. Say clearly in each contract that pay is consolidated, or pay a separate allowance.
- **Minimum wages.** Kenya sets minimum wages by occupation and location through regulation of wages orders. The latest general increase of **6%** took effect on **1 November 2024**, putting a general labourer's basic minimum in the main cities (Nairobi, Mombasa, Kisumu) at about **KES 16,114 a month**, before any housing allowance. Check the current order for your workers' occupations and towns.
- **Service pay.** The Employment Act's service pay does **not** apply to employees who are members of **NSSF**, a registered pension or provident fund, or a more favourable employer scheme. Since nearly every formal employee contributes to NSSF, statutory service pay rarely applies - but redundancy severance does. See [termination and redundancy in Kenya](https://cazini.co.ke/guides/termination-redundancy-kenya).
- **Final pay.** When employment ends, pay outstanding salary, untaken leave and any notice pay, and issue a **certificate of service**.

## Paying salaries: bank and M-Pesa

Kenyan employees are paid in **Kenyan shillings**, typically monthly. Many employers pay to **bank accounts and M-Pesa** - M-Pesa is especially common for staff without bank accounts or for field teams. Whatever channel you use, pay on a fixed date, and keep proof of every payment.

> **Payroll is where most compliance problems start.** Late remittances accumulate penalties quickly, and a deduction shown on a payslip but never remitted is a serious liability for the employer. Reconcile what you deducted against what you remitted every month.

## How Cazini helps

Cazini runs Kenyan payroll with **PAYE, NSSF, SHIF and the Housing Levy** calculated automatically, per-company rate overrides and custom deductions, digital payslips and P9 forms - and pays salaries directly to **M-Pesa and bank** from a payroll wallet. See [payroll](https://cazini.co.ke/payroll).

## Sources

- [Employment Act, 2007 (Ministry of Labour copy, PDF)](https://www.labourmarket.go.ke/media/resources/The_Employment_Act_2007.pdf)
- [KRA: iTax](https://itax.kra.go.ke)
- [The Star: new 6% minimum wage order (October 2024)](https://www.the-star.co.ke/news/2024-10-13-new-6-minimum-wage-order-what-workers-will-earn)
- [WageIndicator: minimum wage in Kenya](https://wageindicator.org/salary/minimum-wage/kenya)

## Frequently asked questions

### What does an employer pay on top of salary in Kenya?

Employers in Kenya pay NSSF (matching the employee's contribution, up to the limit), the Affordable Housing Levy (matching the employee's 1.5%), and the NITA training levy. PAYE and SHIF are deducted from the employee's pay and remitted by the employer, with no employer share.

### When are payroll deductions due in Kenya?

PAYE, SHIF and the Affordable Housing Levy are due by the 9th of the month after the salary month. NSSF contributions are also filed and paid monthly; confirm the current due date on the NSSF employer portal, as published guidance differs.

### Do employers in Kenya have to pay service pay?

Not for employees who are NSSF members. The Employment Act's service pay provision does not apply where the employee belongs to NSSF, a registered pension or provident fund, or a more favourable employer scheme - which covers almost all formally employed staff.

### Can I pay Kenyan employees by M-Pesa?

Yes. Many Kenyan employers pay salaries to M-Pesa as well as bank accounts. The statutory deductions and payslip rules are the same whichever way you pay.

### What is the minimum wage in Kenya?

Kenya sets minimum wages by occupation and location through regulation of wages orders. The latest general increase of 6% took effect on 1 November 2024; check the current order for the occupation and town you are hiring in.