Compare two salaries
Side by side, 2026 rates
Gross cash pay measures earnings before employee deductions. Taxable pay is the amount used to calculate income tax after relevant adjustments. Net pay is the cash left afterwards. Seeing three different figures on one payslip can be entirely correct.
This guide explains which column an item belongs in. For the full progressive-band calculation, use our step-by-step PAYE guide.
A bridge from gross pay to taxable pay
Start with taxable cash earnings, add any taxable value of non-cash benefits, then subtract qualifying deductions and apply any relevant exemption. The result is the income figure used for PAYE. The cash payment calculation follows a separate path.
Under KRA’s current guidance, SHIF and employee Housing Levy are allowable deductions. Registered pension contributions and qualifying mortgage interest can also qualify within the applicable limits and conditions. An item appearing under “deductions” on your payslip does not, on its own, make it an allowable tax deduction.
A KES 100,000 example
Our example assumes one resident employee, one job, a full month of regular cash salary and pensionable pay equal to gross pay. It uses the February 2026 NSSF limits and standard personal relief, with no benefits in kind, extra pension, mortgage deduction, insurance relief, disability exemption or personal repayments. Small payroll rounding differences are possible.
| Calculation step | KES |
|---|---|
| Gross cash earnings | 100,000.00 |
| Less employee NSSF | 6,000.00 |
| Less SHIF | 2,750.00 |
| Less employee Housing Levy | 1,500.00 |
| Taxable pay | 89,750.00 |
KES 89,750 is a tax base, not your expected bank deposit. After calculating PAYE of KES 19,308.35, net cash is KES 70,441.65. The contributions already subtracted in arriving at taxable pay are also real cash deductions; do not deduct them twice when reconciling the final payment.
Classify a new payroll entry before changing your calculation
| Entry | Question to ask |
|---|---|
| A cash allowance | Is it taxable earnings, or is there a specific exclusion supported by records? |
| A car or housing benefit | What taxable value has payroll calculated, and why? |
| A pension contribution | How much qualifies within the combined applicable limit? |
| A loan repayment or savings deduction | Does it simply reduce cash paid, rather than the tax base? |
| A tax relief | Has it been applied to calculated tax rather than subtracted from gross earnings? |
This classification matters when comparing two months. A new personal repayment can lower your bank payment while leaving taxable pay unchanged. A newly recognised qualifying deduction can change taxable pay. A non-cash benefit may increase the taxable figure without increasing cash earnings.
A deduction is different from a relief
A deduction reduces the income on which tax is calculated. A relief reduces the resulting tax bill. Standard personal relief for a qualifying resident is KES 2,400 a month; it is not KES 2,400 of extra salary. For example, tax before relief of KES 21,708.35 becomes PAYE of KES 19,308.35 after that relief.
For the eligibility rules, see legal PAYE deductions and reliefs. For a benefit valuation, use the benefits-in-kind guide rather than treating every benefit as a cash allowance.
Which amount goes into the calculator?
Enter gross cash salary in the PAYE calculator, then supply the relevant benefit and deduction inputs. Entering taxable pay into a field labelled gross salary can cause contributions to be deducted again and produce a misleading result. The salary breakdowns hub shows how the figures fit together; the payslip guide helps you locate them on your own payroll record.
Sources and review date
Published and reviewed on 22 October 2026. Examples use the rules applicable in October 2026, not historical payroll rates.