Employers have until Monday, November 9, to file and pay their October PAYE tax, with the Kenya Revenue Authority (KRA) warning of penalties for those who miss the deadline.
The authority on Friday, November 6, released a nine-point checklist to help employers prepare their returns and avoid mistakes during filing.
KRA wants employers to begin by checking their payroll records and making sure the correct Personal Identification Numbers (PINs) have been captured for all employees.
They are also required to include taxable benefits such as allowances, bonuses and other payments made to employees when working out the tax due.
Employers must then account for the deductions and reliefs applicable to their workers, use the correct tax bands and compare the final figures with their payroll records before submitting the returns.
Once the figures have been checked, employers are expected to log in to the iTax portal, complete and submit the October PAYE return, generate a payment slip and settle the amount due.
KRA has also reminded employers to download their filing acknowledgement receipts and keep proof of payment for future reference.
Under Section 37 of the Income Tax Act, an employer should deduct PAYE from the earnings of his/her employees before paying the amount to KRA. This includes wages, commissions, overtime, leave pay, bonuses and allowances.
An employee’s taxable income should also include benefits given by the employer like accommodation, company cars.
Monthly PAYE for the year 2026 falls within the range of 10 per cent to 35 per cent according to the salary earned by an individual.
The first KSh24,000 will be taxed at 10 per cent while KSh8,333 is taxed at 25 per cent. Earnings that fall within the range of KSh32,334 and KSh500,000 attract a tax of 30 per cent.
Tax of 32.5 per cent is charged on earnings within the range of KSh500,001 and KSh800,000. More than KSh800,000 is taxed at 35 per cent.
Employers who file their returns late face a penalty of 25 per cent of the tax due or KSh10,000, whichever is higher. Late payment also attracts a 5 per cent penalty and monthly interest of 1 per cent.
