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Finance Act 2016:New Paye Tax Bands Effective Jan 2017
Rank: Member Joined: 12/17/2016 Posts: 225
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Happy new year team. I saw notice by KRA on new PAYE rates effective January 2017. The new act has widened the tax bands by10%. New bands will be: On the 1st Kes 134,164.........10% On the next Kes 126,403........15% On the next Kes 126,403.........20% On the next Kes 126,403.........25% On all income over Kes 513,373.........30% To the tax analysts, any idea how this will affect employee income? Does it benefit low earners or high earners? Note: I hope I have posted in the right forum since I am newbie to Wazua-No backlash if contrary Reflection Eternal
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Rank: Elder Joined: 2/7/2007 Posts: 11,935 Location: Nairobi
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Try your figures with the KRA PAYE calculator choose the previous year, the try 2017 ans see if there is a difference. This still does not take the place of Wazua tax analysts https://calculator.co.ke...come-tax-paye-calculatorNothing great was ever achieved without enthusiasm.
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Rank: Elder Joined: 2/8/2013 Posts: 4,068 Location: At Large.
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Please work it out for me.If you say there is a difference I'll accept if you say there is none I'll also accept. On a serious note the page ain't loading.Am keen to know if I have an "increament" due to the same. Have tried manually and the figures seem too good to be true. Love is beautiful and so are those who share it.With Love, Marriage is an amazing event in ones life time, the foundation of joy, happiness and success.
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Rank: Elder Joined: 2/22/2009 Posts: 2,449 Location: Africa
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Picked from Facebook
Quote "How the new tax bands will affect your salary Many readers have asked me this: “Is it true that PAYE tax rates will be reduced by 10 per cent from January 2017?” The answer is an emphatic NO! The tax rates are not being reduced, but the method of calculation will change and the effect will be a reduction in the amount payable to the taxman. First of all, let me dispel the common misconception that high-income earners pay 30 per cent tax. That is also not true: there is no individual taxpayer in Kenya who pays that much tax. The misunderstanding arises from the fact that many people do not know how taxes are calculated — a very sad state of affairs indeed. How can you not be interested in knowing how the government takes your money? Isn’t it the height of irresponsibility? TAX BANDS There are five tax bands in Kenya: 10pc, 15pc, 20pc, 25pc and 30pc. Currently, the first Sh10,164 is charged 10pc tax; the next Sh9,576 (that is, from Sh10,165 to Sh19,740) is taxed 15pc; the rate for the next Sh9,576 (that is from Sh19,741 to Sh29,316) is 20pc; the next Sh9,576 (from Sh29,317 to Sh38,892) is charged 25pc; after that, any amount from Sh38,892 attracts 30 per cent tax. So, if you earn Sh40,000 per month, only Sh1,108 (that is Sh40,000 – Sh38,892) will attract the 30pc tax; not the entire Sh40,000. For this income, the first band attracts Sh1,016.40 tax (10pc of Sh10,164); for the second band it is Sh1,436.40 (15pc of Sh9,576); the third band is taxed Sh1,915.20 (20pc of Sh9,576); the fourth band is charged Sh2,394.00 (25pc of Sh9,576). Finally, the top Sh1,108 is charged 30, that is Sh332.40. These amounts from each tax band are then added together to get the total tax. The answer is Sh7,094.40. This is much less than what you would get if you simply calculated 30 per cent of Sh40,000 Sh12,000). TAX RELIEF There is still one more step remaining before getting the final tax payable. Every individual taxpayer (that is, not companies) qualifies for tax relief of Sh1,162 per month. This is subtracted from the above calculation, bringing the net tax payable to Sh5,932.40. So what will happen from January 2017? First, the tax relief will be increased to Sh1,280 per month. Next, the 10pc tax band will cover income up to Sh11,180 per month. From there, the remaining bands will increase by Sh10,533.50 up from the current Sh9,576. Thus, from Sh11,181 to Sh21,714 will be charged 15pc; from Sh21,715 to Sh32,248 will attract 20pc; from 32,249 to Sh42,782 will be taxed 25pc; and any income above Sh42,783 will be charged 30pc. So, for a person earning Sh40,000 per month, none of that income will fall into the 30pc band. The top rate for this income will be 25pc and only Sh7,751 Sh40,000 – Sh32,249) will attract that tax. The corresponding taxes for each band will be Sh1,118 (for the 10pc); Sh1,580.10 (for the 15pc); Sh2,106.80 (for the 20pc); and Sh1,937.75 for the 25pc band. Adding all these values makes a total of Sh6,742.65. Deducting the Sh1,280 personal relief leaves a net tax of Sh5,462.65. This is Sh470 less than the current value. It is certainly not a 10pc reduction."
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Rank: Elder Joined: 10/18/2008 Posts: 3,434 Location: Kerugoya
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Flo-ology wrote:Note: I hope I have posted in the right forum since I am newbie to Wazua-No backlash if contrary Flo-ology wrote:Note: I hope I have posted in the right forum since I am newbie to Wazua-No backlash if contrary Welcome to the Virtual Republic of Wazua. Do not be a stranger but post often. How about once per day at the minimum? This thread should have been at the Blues, but since you ask so nicely, I shall let it pass. In any case, if the Office of the Administrator was not so busy calculating how much they will squeeze from you, they would transfer this thread to its rightful place. Again, welcome to the Virtual Republic of Wazua. Incidentally, are you a Lady or a Gentleman and are you affiliated to the NASA or the Jubilee Special Purpose Political Vehicle? Again, welcome to the Virtual Republic of Wazua.
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Rank: Elder Joined: 7/28/2015 Posts: 9,562 Location: Rodi Kopany, Homa Bay
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aemathenge wrote:Flo-ology wrote:Note: I hope I have posted in the right forum since I am newbie to Wazua-No backlash if contrary Flo-ology wrote:Note: I hope I have posted in the right forum since I am newbie to Wazua-No backlash if contrary Welcome to the Virtual Republic of Wazua. Do not be a stranger but post often. How about once per day at the minimum? This thread should have been at the Blues, but since you ask so nicely, I shall let it pass. In any case, if the Office of the Administrator was not so busy calculating how much they will squeeze from you, they would transfer this thread to its rightful place. Again, welcome to the Virtual Republic of Wazua. Incidentally, are you a Lady or a Gentleman and are you affiliated to the NASA or the Jubilee Special Purpose Political Vehicle? Again, welcome to the Virtual Republic of Wazua. We also pay taxes and therefore the thread is in the right place.
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Rank: Elder Joined: 10/18/2008 Posts: 3,434 Location: Kerugoya
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hardwood wrote:We also pay taxes and therefore the thread is in the right place. Yeah. Right. Teach them corruption while they are still young. That way, they will never learn what is right or wrong.
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Rank: Elder Joined: 7/28/2015 Posts: 9,562 Location: Rodi Kopany, Homa Bay
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aemathenge wrote:hardwood wrote:We also pay taxes and therefore the thread is in the right place. Yeah. Right. Teach them corruption while they are still young. That way, they will never learn what is right or wrong. ????? whenever I look at my P9 form I am shocked by how much money I pay to gov't Basically 30% of my pay goes to gov't. And its alot of money that could buy me a kaploti at syokimau every year. Then I read that kabura is waiting for that tax I pay with her gunias hapo kwa bank. #BoycottTaxes
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Rank: Elder Joined: 10/18/2008 Posts: 3,434 Location: Kerugoya
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hardwood wrote:aemathenge wrote:hardwood wrote:We also pay taxes and therefore the thread is in the right place. Yeah. Right. Teach them corruption while they are still young. That way, they will never learn what is right or wrong. ????? whenever I look at my P9 form I am shocked by how much money I pay to gov't Basically 30% of my pay goes to gov't. And its alot of money that could buy me a kaploti at syokimau every year. Then I read that kabura is waiting for that tax I pay with her gunias hapo kwa bank. #BoycottTaxes We are all circumcised so why not put the circumcision thread in Economy at the Blues instead of Health at SK? Or why put up a urinal if everyone can piss in the shit cubicle or the hand basin? Or we will all die one day, won’t we? So why not place the “2 rugby players dead in 2 weeks” thread in Life of SK and not Sports? Or why have all these sections in the first place? Why don’t we revert to one environment like the one we used to have in the good old days Stock Kenya?
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Rank: Elder Joined: 10/18/2008 Posts: 3,434 Location: Kerugoya
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hardwood wrote:Then I read that kabura is waiting for that tax I pay with her gunias hapo kwa bank. I would love to see your face when you read this. Link:
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