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What is Pay As You Earn?

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  • Post category:Blog on Tax
  • Post last modified:November 4, 2025
  • Reading time:1 min read

PAY As You Earn (PAYE) is not a tax but a method of collecting income tax from compensations of employees and directors:

  1. Basic salary,
  2. Allowances,
  3. Benefits.

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b. Tax Contents Disclaimer: The tax industry in Kenya is very dynamic. The tax contents in the posts are not professional advice. Read full disclosure HERE.

Why you need to learn about PAYE:

  1. To know how to negotiate for correct salaries.
  2. To appreciate that 1/3 of your earnings is tax.

PAYE is collected from individuals.

  1. Employees.
  2. Directors.

The individuals are:

  1. Tax Residents,
  2. Non-Tax residents.

Pay As You Earn Video

To find out more about Pay As You Earn, watch the video.

Dr. Wakaguyu

taxkenya@gmail.com

Tax-crimes

Tax Crimes Quiz

This quiz is to test your understanding of actions the tax commissioner considers tax crimes. Having read the article, why not test your knowledge?

1 / 11

#1. When a taxpayer purposely does not file tax returns by the deadline, what is the action called?

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#2. Failing to charge, collect, and remit taxes, on purpose is known as?

3 / 11

# 3. Making false statements to the tax commissioner is classified as?

4 / 11

# 4. VAT or income tax refunds based on false information are known as?

5 / 11

# 5. Leaving out some income in a tax year of income is called?

6 / 11

# 6. Keeping two sets of books, one official and one unofficial, is known as?

7 / 11

# 7. Assisting others in keeping fake tax records is called?

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8 / 11

# 8. Participating in plans to stop tax collection is known as?

9 / 11

#9. Increasing expenses for purposes of lowering the tax payable by a taxpayer is referred to as?

10 / 11

# 10. Moving unreported income from one country to a tax haven is referred to as?

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# 11. Setting up tax losses that can be carried over indefinitely is called?

Your score is

The average score is 44%

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