Refund or balance due at filing time.
Refund or balance
—
Annual liability
—
Insurance relief
—
PAYE deducted
—
Why a refund or a balance arises at all
PAYE is a pay-as-you-go system. Your employer estimates your tax month by month and remits it, but that monthly guess is rarely a perfect match for your true liability over the whole year. When you file your annual return, KRA recomputes the tax on your full-year income using the annual bands, credits the reliefs you are entitled to, and compares the result against everything already deducted. If the deductions overshot, you are owed a refund. If they fell short, you carry a balance to settle. This tool runs that same comparison so you can see, before you file, roughly which side of the line you land on.
Several ordinary situations push you off a clean match. Changing jobs mid-year, where a new employer restarts your reliefs as if you were a fresh hire, commonly causes over-deduction. Bonuses taxed at a flat high rate, allowances added late, or relief you were entitled to but never claimed all shift the figure. The estimator is most useful precisely in those messy years.
What the estimator weighs against your deductions
The calculation has three moving parts. First, your annual liability, worked out on the progressive annual bands. As modelled here those bands run 10 percent up to KES 288,000, then 25 percent, 30 percent, 32.5 percent and 35 percent on successively higher slabs, with a personal relief of KES 28,800 a year netted off. Second, insurance relief, set at 15 percent of qualifying premiums up to a cap, which the tool annualises and subtracts from the liability. Third, the PAYE your employers actually deducted, which you read off your P9 form. The result is simply deductions minus the relieved liability. Every rate, band, and relief figure here is the one the calculator applies; Kenya has changed PAYE bands and reliefs through recent Finance Acts, so confirm the current numbers with KRA before relying on the estimate.
A year where you end up owing
Consider someone with KES 1.8 million of annual taxable income who paid KES 5,000 a month in life-insurance premiums and whose employers deducted KES 360,000 of PAYE across the year. The insurance relief is 15 percent of the premiums, but capped, so it lands at KES 750 a month, KES 9,000 for the year. These figures use the rates this calculator applies.
| Step | Amount (KES) |
|---|
Because the deductions fell about KES 79,600 short of the relieved liability, this taxpayer owes rather than receives. The chart sets the liability against what was withheld so the shortfall is plain.
Reading the result without fooling yourself
A refund feels like a windfall, but it usually means you lent KRA money interest-free all year. If you consistently see large refunds, it can be worth asking your employer to fix your reliefs so more reaches you each month. A balance due is the opposite warning: set the cash aside before the filing deadline so the bill does not surprise you. One frequent error is forgetting that this estimator works on taxable income, not gross pay. Statutory deductions and allowable items reduce gross to taxable before the bands bite, so feed in the taxable figure from your P9, not your headline salary, or the estimate will overstate the tax.
Where do I find the PAYE already deducted?
It is on your P9 form, which every employer issues after the year of income. The P9 lists your monthly taxable pay, the PAYE deducted, and the reliefs applied. Add up the PAYE column for the figure to enter here. If you worked for more than one employer, gather a P9 from each and total them, because the estimator needs the full year of deductions.
If the tool shows a refund, how do I actually get it?
You claim it through your annual return on KRA's iTax portal. A refund is not paid automatically just because one is due; you have to file and lodge the claim, and KRA may verify before processing. Treat this estimate as a prompt to file accurately and on time rather than as the refund landing in your account.