Tax Reliefs in Kenya

Deductions and reliefs are different

A deduction reduces taxable income before the PAYE bands are applied. A relief reduces the resulting tax. Neither guarantees a refund: the saving depends on your taxable income, eligibility and tax already paid. Personal relief is KES 2,400 monthly for resident individuals; a KRA PIN alone does not establish residency.

Pension and mortgage deductions

Registered pension contributions, including NSSF, share a deduction limit: the lowest of actual qualifying contributions, 30% of pensionable income and KES 30,000 monthly. The extra pension allowance is not KES 30,000 on top of NSSF. At KES 100,000 pensionable pay, NSSF of KES 6,000 leaves up to KES 24,000 of additional deductible contributions. Contributions still cost cash even when they save tax.

Qualifying home-loan interest

Interest paid on a qualifying owner-occupied residential loan can be deducted up to KES 30,000 monthly (KES 360,000 annually). Principal repayments do not qualify. Confirm the lender and loan meet the statutory conditions. A KES 30,000 deduction saves KES 9,000 only where the whole deduction falls in the 30% band; it is not a universal maximum saving.

Insurance and disability

Insurance relief is 15% of qualifying life, health or education premiums, capped at KES 60,000 relief annually. Education policies must meet the maturity requirements. Current SHIF contributions are deducted before PAYE; do not also claim insurance relief on them. Disability income exemption requires a valid tax exemption certificate, not just an NCPWD card. Apply its validity period and prescribed income limit; an exemption is not a KES 150,000 tax credit.

Claim with evidence

Give payroll the relevant policy certificates, premium receipts, pension statements, mortgage interest certificate or valid exemption certificate. KRA requires employers to apply qualifying documented claims within the limits. Check your payslip and P9, and reconcile omissions through the applicable return or correction process. Refunds require verification and are not automatic. Qualifying post-retirement medical fund contributions have a separate KES 15,000 monthly limit. HELB repayments, SACCO savings and salary advances reduce cash received but are not general PAYE deductions.

Sources and further checks

• KRA PAYE rates and deductions
• KRA December 2024 PAYE amendments
• KRA employer guidance

Use the linked topic articles below for detailed examples and eligibility checks.