The Ministry of Defence is committed to defending and protecting the people of the Republic of Kenya and their property against external aggression and also in providing support to the Civil Authority as per the Law. A Captain is a commissioned officer in the United States Army at DoD paygrade O-3. A Captain receives a monthly basic pay salary starting at $4,144 per month, with raises up to $6,742 per month once they have served for over 14 years.
What is PAYE?. PAYE applies to all form employments and its a method of deducting income tax from salaries and wages applies to all income from any office or employment. It applies to weekly wages, monthly salaries, annual salaries, bonuses, commissions and directors fees and housing.
PAYE tax does include income from casual employment which means any engagement with any one employer which is made for a period of less than one month. PAYE deduction from any form employment can be calculated using the.
It's an employer's statutory duty to deduct PAYE from the pay of his employees throughout the financial year. Common terms in PAYE regulations. An Employer defines:. Any person having control of payment of remuneration.
Any agent, manager or other representative in Kenya of any employer who is outside Kenya. Any paying officer of government or other public authority. Any trust or insurance company or other body or person paying pensions. An employee defines any inclusive holder of an appointment of office, whether public or private, for which remuneration is payable. It also applies an employee who retires on pension and stays in Kenya where pensions received from a registered pension fund exceed KSh 25,000 per month and up to KSh 300,000 per annum. A paying point is the place at which remuneration is paid. Monthly pay includes income in respect of any employment or service rendered, accrued in or derived from Kenya.This includes:.
Wages, salary, leave pay, sick pay, payment in lieu of leave, directors’ fees and other fees, overtime, commission, bonus, gratuity or pension whether payable monthly or at longer intervals. Cash allowances, e.g. House allowance, phone allowance e.t.c. The amount of any private expenditure of the employee paid by the employer other wise than as a loan, e.g. House rent, grocer y bills, electricity, water, telephone bills, school fees.
Non-cash benefits above Ksh 3,000 per month. The value of housing, where provided by the employer. SalaryContributionKSh 5,999KSh 150KSh 6,000 – 7,999KSh 300KSh 8,000 – 11,999KSh 400KSh 12,000 – 14,999KSh 500KSh 15,000 – 19,999KSh 600KSh 20,000 – 24,999KSh 750KSh 25,000 – 29,999KSh 850KSh 30,000 – 34,999KSh 900KSh 35,000 – 39,999KSh 950KSh 40,000 – 44,999KSh 1,000KSh 45,000 – 49,999KSh 1,100KSh 50,000 – 59,999KSh 1,200KSh 60,000 – 69,999KSh 1,300KSh 70,000 – 79,999KSh 1,400KSh 80,000 – 89,999KSh 1,500KSh 90,000 – 99,999KSh 1,600KSh 100,000 & AboveKSh 1,700Self-EmployedKSh 500. What is NSSF?The National Social Security Fund (NSSF) core mandate is to provide basic financial security benefits to Kenyans upon retirement in the both the formal and informal sectors of the economy. NSSF pension contribution are based on an individual's gross income, the Upper Earning Limit (UEL) is KSh 18,000 while the Lower Earnings Limit (LEL) is KSh 6,000. The pension contribution is 12% of the pensionable wages made up of two equal portions of 6% from the employee and 6% from the employer subject to an upper limit of KSh 2,160 for employees earning above KSh 18,000.
The employee contribution shall be drawn directly from his salary and wages while the employers contribution shall come directly from the employer. The contributions relating to the earnings below the LEL of the earnings (a maximum of KSh 720) is credited to Tier I account while the balance of the contribution for earnings between the LEL and the UEL (up to a maximum of KSh 1,440) is credited to Tier II account. How is housing allowance taxed?a. The housing benefit for a director and a whole time ser vice director shall be the higher of 15% of total income (or employment income, in case of whole time ser vice director), the fair market rental value and the actual rent paid by the employer.b. Agricultural Employee (Including a whole time ser vice director) who is required by terms of employment to reside on a plantation or farm:a. 10% of his gains or profits from employment minus any rent charged to the employee.
This is subject to employer obtaining prior approval from Domestic Taxes Office. (see also reduced rates of benefits for agricultural employees - Appendix 5).i. Agricultural employee shall not include a director other than a whole-time ser vice director.c. Any other EmployeeThe taxable value shall be the higher of an amount equal to 15% of the gains or profits from employment or ser vices rendered, excluding the value of those premises, or the rent paid by the employer if paid under an agreement made at arm’s length with a third party:Provided that:i. If employer pays rent under an agreement not made at arm’s length with a third party, the value of quar ters shall be; the fair market rental value of the premises in that year or rent paid by the employer; whichever is higher, orii. Where the premises are owned by employer; the fair market rental value of the premises in that year is to be taken.N/B:i.In calculating the housing benefits employer is required to deduct rental charges recovered from the employee or director.
The amount remaining is the chargeable value to be included in the total taxable pay.- If the premises are occupied for par t of the year only, the value is 15% ofemployment income relative to the period of occupation less any rental charges paid by employee/director. (Chargeable value shall be reduced by rent paid by an employee).- Any employer who provides other than normal housing to an employee should consult his local Domestic Taxes office for advice regarding the value of such housing.For Example:James who earns basic salary of KSh 30,000 per month plus other benefits: Motor Car, House Servants etc.
KSh 15,000/= is housed and the employer pays to the Landlord rent of KSh 20,000 per month (i.e. KSh 240,000 per annum) under an agreement made at arm’s length with the third party.Calculation value of quarters.
How is car allowances taxed?Where an employee is provided with a motor vehicle by employer, the chargeable benefit for private use shall be the higher of the rate determined by the Commissioner and the prescribed rate of benefit. Where such vehicle is hired or leased from third party, employees shall be deemed to have received a benefit in that year of income, equal to the cost of hiring or leasing. The “prescribed rate of benefit” means the following rates for each month on the initial cost of the vehicle:a. 1996 = 1% per month of initial cost of the vehicleb. 1997 = 1.5% per monthc.
1998 = 2% per monthExampleWairimu is employed as a Financial Controller is provided with a car - MitsubishiPajero (cc rating 2400) which was bought in July 2016 for KSh 2,500,000.Car benefit is calculated as follows:i. 2% x KSh 2,500,000 = KSh 50,000 per monthii. Commissioner’s fixed monthly rate cc.
Rating 2,400 = KSh 8,600iii. The chargeable car benefit is therefore KSh 50,000 per month.N/B Where an employer has restricted use of the motor vehicle, the Commissioner if satisfied of that fact, shall determine a lower rate of the benefit depending on the usage of the motor vehicle. Q.How is medical services and medical insurance benefits deducted?Where an employer provides its employees (including directors) and their beneficiaries (spouse & upto 4 children whose age does not exceed 21 years) with free medical services or free medical insurance, the value of such medical service or insurance is not a taxable benefit on the employee.Please note that:a. In the case of medical services provided to a director other than a whole time service director shall be the limit which will be prescribed by the Cabinet Secretary from time to time. The current limit is Kshs.1,000,000 per year.b. The medical insurance must be provided by a provider who is approved by the Commissioner of Insurance. Are passages non-taxable benefits?When an employer himself pays for or reimburses the cost of tickets for passages, including leave passages for his employee and family, the value of the passages is a non- taxable benefit of the employee if the employee is recruited outside Kenya and is in Kenya solely for the purpose of serving his employer and he is not a citizen.
Where, however, such employee receives a cash sum either periodically or in one amount which he is free to save or spend as he chooses or for any other purposes and for the expenditure of which he does not have to account to the employer, the amount received is a taxable cash allowance. Passages paid for by the employer in circumstances other than that in italic above are a taxable benefit on the employee. Q.What is a defined benefit fund or defined contribution fund?Employees contributions to registered contribution funds like NSSF are admissible as tax deduction. The maximum allowable pension fund contribution is KSh 20,000 per month and upto KSh 240,000 per year.
Contributions made by individual to a retirement fund are also applicable if the contributions are 30% of the income or upto Ksh20,000 per month. However, contributions paid by a non-taxable employer to unregistered pension scheme or excess contributions paid to a registered fund or individual retirement fund; shall be employment benefit chargeable to tax on the employee. Q.What are allowed tax exemptions?.
Persons living with disabilitiesPersons living with disabilities with a valid exemption certificate are exempted from income tax on their taxable income of KSh 150,000 per month and upto KSh 1,800,000 per year. Persons living with disabilities can calculate their allowed disability relief using the. Income tax exemption of bonuses, overtime allowance & retirement benefitsBonuses, overtime allowance and retirement benefits are tax exempt where they are paid to an employee whose gross salary before the bonus and overtime allowance does not exceed KSh11,180 per month as from July, 2016. Q.What is personal tax relief?.
Personal reliefAll individuals with taxable income are entitled to a personal relief of KSh1,408 per month and upto KSh16,896 per year as from January 2018. Employers are advised to automatically grant personal relief to all employees irrespective of their status. What are tax deduction cards (P9)?A P9 form is prepared by employer for every employee liable to income tax.
It provides a detailed record of employee's gross pay, benefits, chargeable income, personal relief and income tax PAYE deducted throughout the calendar year. Types of P9 forms:. Form P9A: Applicable for all employees whose earnings exceeds the minimum wage of Kshs.12,260/= per month and are in receipt of non-cash benefits, valued at KSh 3,000 or more per month which together with cash pay.
Form P9A (HOSP):Applicable for employees is eligible for a deduction for registered home ownership savings plan. Form P9B: Applicable for employees, where the employer bears the burden of tax on behalf of the employee. Q.How is PAYE remitted to the KRA?The Law requires an employer to pay-in the PAYE. Tax deducted from his employees’ pay before the 10th day of the month following pay-roll month. Failure and/or late PAYE payments will incur penalty at the rate of 25 per cent of amount paid late as per Section 37(2) of the Income Tax Act and interest at 1% per month per as per Section 38(1) of the Tax Procedures Act, 2015.
If an employer finds that he is unable to make his monthly payments by the due date - i.e. Before the 10 th day of the month following the month of deduction - for reasons of remoteness, he should make full representations setting out all the relevant facts to the appropriate Domestic Taxes Office. Employers are required to make payments of tax recovered from Lump Sum amounts, tax established through PAYE.
Adjustments, penalty or interest imposed for PAYE. Offences to the Commissioner of Domestic Taxes using Payment Registration Number (PRN).N/B: Penalties and Interest:a) PAYE offences - Section 37(2)The Commissioner may impose a penalty under Section 37 (2) of the Income Tax Act if an employer fails:i. To deduct tax upon payment of emoluments to an employeeii. To account for tax deductediii.
Page: 1653GAZETTE NOTICE NO. 2885THE CONSTITUTION OF KENYAREMUNERATION AND BENEFITS OF STATE OFFICERS IN THE EXECUTIVEIN EXERCISE of the powers conferred by Article 230 (4) ( a), the Salaries and Remuneration Commission has set the remuneration and benefits of State Officers in the Executive as follows:REMUNERATION AND BENEFITS OF STATE OFFICERS IN THE EXECUTIVEState OfficerGross Monthly Remuneration Package (KSh.)President of the Republic of Kenya1,237,500 x 103,125 p.a. 1,340,625 x 103,125 p.a. 1,443,750 x 103,125 p.a. 1,546,875 x 103,125 p.a. 1,650,000Deputy President1,051,875 x 87,656 p.a.
1,139,531 x 87,656 p.a. 1,227,188 x 87,656 p.a.
1,314,844 x 87,656 p.a. 1,402,500Cabinet SecretaryAttorney-GeneralSecretary to the CabinetChief of Defence Forces792,000 x 66,000 p.a. 858,000 x 66,000 p.a.
924,000 x 66,000 p.a. 990,000 x 66,000 p.a. 1,056,000Principal SecretaryVice-Chief of the Defence ForcesCommander, Kenya ArmyDirector-General (NIS)Inspector-General, National Police Service655,875 x 54,656 p.a. 701,531 x 54,656 p.a.
765,188 x 54,656 p.a. 819,844 x 54,656 p.a. 874,500Director of Public ProsecutionsCommander, Kenya Air forceCommander, Kenya Navy640,681 x 30,509 p.a. 671,190 x 30,509 p.a. 701,698 x 30,509 p.a. 732,207 x 30,509 p.a.
762,715 x 30,509 p.a. 793,224 x 30,509 p.a. 823,732 x 30,509 p.a. 854,241Deputy Inspector-General, Kenya Police ServiceDeputy Inspector-General, Administration Police Service532,500 x 25,357 p.a.
557,857 x 25,357 p.a. 583,214 x 25,357 p.a. 608,571 x 25,357 p.a. 633,929 x 25,357 p.a. 659,286 x 25,357 p.a.
684,643 x 25,357 p.a. 710,000Registrar of Political Parties532,500 x 35,500 p.a. 568,000 x 35,500 p.a. 603,500 x 35,500 p.a. 639,000 x 35,500 p.a. 674,500 x 35,500 p.a. Page: 1654GAZETTE NOTICE NO.
2886THE CONSTITUTION OF KENYAREMUNERATION AND BENEFITS FOR STATE OFFICERS IN PARLIAMENTIN EXERCISE of the powers conferred by Article 230 (4) ( a), the Salaries and Remuneration Commission has set the remuneration and benefits of State Officers in Parliament as follows:REMUNERATION AND BENEFITS OF ALL STATE OFFICERS IN PARLIAMENTState OfficerGross Monthly Remuneration Package (KSh.)Speaker of the National AssemblySpeaker of the Senate990,000 x 82,500 p.a.– 1,072,500 x 82,500 p.a. – 1,155,00 x 82,500 p.a. – 1,237,500 x 82,500 p.a.
– 1,320,000Deputy Speaker of the National AssemblyDeputy Speaker of the Senate792,000 x 66,000 p.a. – 858,000 x 66,000 p.a. – 924,000 x 66,000 p.a. – 990,000 x 66,000 p.a.
– 1,056,000Leader of Majority PartyLeader of the Minority PartyChairpersons of CommitteesMembers of Speakers PanelChief WhipsMinority WhipsMember of the National AssemblyMember of the Senate532,500 x 44,375 p.a. – 576,875 x 44,375 p.a.– 621,250 x 44,375 p.a. – 665,625 x 44,375 p.a.
Page: 1656GAZETTE NOTICE NO. 2887THE CONSTITUTION OF KENYAREMUNERATION AND BENEFITS OF STATE OFFICERS IN THE CONSTITUTIONALCOMMISSIONS AND INDEPENDENT OFFICESIN EXERCISE of the powers conferred by Article 230 (4) ( a), the Salaries and Remuneration Commission has set the Remuneration and Benefits of State Officers in the Constitutional Commissions and Independent Offices as follows:REMUNERATION AND BENEFITS OF STATE OFFICERS IN THE CONSTITUTIONALCOMMISSIONS AND INDEPENDENT OFFICESState OfficerGross Monthly Remuneration Package (KSh.)Auditor General792,000 x 37,714 p.a. – 829,714 x 37,714 p.a. – 867,429 x 37,714 p.a.
– 905,143 x 37,714 p.a. – 942,857 x 37,714 p.a. – 980,571 x 37,714 p.a. – 1,018,286 x 37,714 p.a. – 1,056,000Chairperson, Independent Electoral and Boundaries CommissionChairperson, Commission for the Implementation of the Constitution792,000 x 52,800 p.a.
– 844,800 x 52,800 p.a. – 897,600 x 52,800 p.a.
– 950,400 x 52,800 p.a. – 1,003,200 x 52,800 p.a. – 1,056,000Controller of Budget655,875 x 31,232 p.a.
– 687,107 x 31,232 p.a. – 718,339 x 31,232 p.a.
– 749,571 x 31,232 p.a. – 780,804 x 31,232 p.a. – 812,036 x 31,232 p.a.
– 843,268 x 31,232 p.a. – 874,500Vice Chairperson, Independent Electoral and Boundaries CommissionVice-Chairperson, Commission for the Implementation of the Constitution655,875 x 43,725 p.a. – 699,600 x 43,725 p.a.
– 743,325 x 43,725 p.a. – 787,050 x 43,725 p.a. – 830,775 x 43,725 p.a. – 874,500Chairperson, all other Constitutional Commissions;Member, Independent Electoral and Boundaries CommissionMember, Commission for the Implementation of the Constitution640,681 x 42,712 p.a.
– 683,393 x 42,712 p.a. – 726,105 x 42,712 p.a.
– 768,817 x 42,712 p.a. – 811,529 x 42,712 p.a. – 854,241Vice Chairperson, all other Constitutional CommissionsMembers, all other Constitutional Commissions532,500 x 35,500 p.a. – 568,000 x 35,500 p.a. – 603,500 x 35,500 p.a. – 639,000 x 35,500 p.a.
– 674,500 x 35,500 p.a. – 710,000Secretary of Constitutional Commission526,058 x 25,055 p.a.
– 551,113 x 25,055 p.a. – 576,167 x 25,055 p.a. – 601,222 x 25,055 p.a. – 626,277 x 25,055 p.a. – 651,332 x 25,055 p.a. – 676,386 x 25,055 p.a.
Page: 1657GAZETTE NOTICE NO. 2888THE CONSTITUTION OF KENYAREMUNERATION AND BENEFITS OF STATE OFFICERS SERVING IN THE COUNTY GOVERNMENTIN EXERCISE of the powers conferred by Article 230 (4) ( a), the Salaries and Remuneration Commission has set the remuneration and benefits of State Officers in the County Government as follows:REMUNERATION AND BENEFITS OF STATE OFFICERS SERVING IN THE COUNTY GOVERNMENTState OfficerGross Monthly Remuneration Package (KSh.)County Governor640,681 x 53,390 p.a. – 694,071 x 53,390 p.a. – 747,461 x 53,390 p.a.
– 800,851 x 53,390 p.a. – 854,241Deputy County Governor461,250 x 38,438 p.a.– 449,688 x 38,438 p.a.– 538,125 x 38,438 p.a.– 576,563 x 38,438 p.a. – 615,000Speaker of the County AssemblyMember of the Executive Committee225,000 x 18,750 p.a.– 243,750 x 18,750 p.a.– 262,500 x 18,750 p.a.– 281,250 x 18,750 p.a. – 300,000Member of the County Assembly79,200 x 6,600 p.a.– 85,800 x 6,600 p.a.– 92,400 x 6,600 p.a.– 99,000 x 6,600 p.a.