Following the Finance bill 2018, the Cabinet Secretary proposed to increase the Individual PAYE bands by 10%. This increase follows a subsequent extension that was implemented on 1 January 2017. The new bands are as follows:
New KRA PAYE Tax Rates
|Annual PAYE bands (KES)||2017 Annual PAYE Old bands (KES)||Rate|
|First 147,576||First 134,160||10%|
|Next 139,056||Next 126,408||15%|
|Next 139,056||Next 126,408||20%|
|Next 139,056||Next 126,408||25%|
|Over 564,744||Over 513,384||30%|
The above changes will provide a welcome cushion to taxpayers whose income has been adversely affected by inflation
Likewise, beginning January 2018, the PAYE personal relief increased by a 10 percent from KES 15,360 per annum. i.e. KES 1280 per month to KES 16,896 per annum i.e. KES 1,408. Resulting from the above changes, only persons earning more than to KES 13,486 per month will be charged PAYE. Previously
the lowest taxable income was KES 12,260 per month.
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