Automated Statutory Deductions
Statutory deductions are where casual construction payroll most often quietly breaks the law. Cash wages are paid without a PAYE calculation, NSSF and SHIF contributions are missed, and by the time the returns are due nobody can reconstruct who earned what. FundiPay calculates every deduction per worker as payroll runs, so compliance happens automatically instead of being late paperwork.
Updated October 17, 2026 · Product
The deductions FundiPay handles
FundiPay computes the four deductions that apply to Kenyan wage payroll, using each worker's gross pay for the period. Because it sits inside the payroll run, the figures are produced from the same attendance and rates that drive the payment — not back-calculated from a rough total.
- PAYE, using the resident bands and the monthly personal relief.
- NSSF Tier I and Tier II contributions, with the employer match.
- SHIF (the Social Health Insurance Fund) at 2.75% of gross.
- The Affordable Housing Levy at 1.5% employee and 1.5% employer.
How PAYE is calculated
PAYE is charged on taxable pay using the graduated bands: 10% on the first KES 24,000, 25% from 24,001 to 32,333, 30% from 32,334 to 500,000, 32.5% from 500,001 to 800,000 and 35% above that. The monthly personal relief of KES 2,400 is applied. FundiPay applies the bands per worker for the period and shows the result on the payslip, so a fundi can see not just what was deducted but why.
NSSF, SHIF and the housing levy
NSSF under the 2013 Act runs in two tiers: Tier I is 6% of pensionable pay up to KES 8,000 (a maximum of 480), and Tier II is 6% on earnings between 8,001 and 72,000 (a maximum of 3,840), with the employer matching the total. SHIF, administered by the Social Health Authority, replaced NHIF on 1 October 2024 and is charged at 2.75% of gross monthly salary with no upper cap. The Affordable Housing Levy adds 1.5% from the employee and 1.5% from the employer.
All of these returns are filed monthly and are due by the 9th of the following month. FundiPay keeps the per-worker contribution records behind each return, so the numbers can be traced rather than estimated.
Only for the workers who are employees
Not every person on a construction site is an employee for statutory purposes, and mixing them up creates both compliance risk and unnecessary cost. FundiPay lets you record the correct engagement basis per worker, so the right deductions are applied to the right people. Read the guides below on PAYE, NSSF, SHIF and the housing levy before you finalise how your crews are engaged.
Frequently asked questions
Does FundiPay file the returns for us?
FundiPay computes the deductions per worker and produces the figures and records you need for each monthly return. Your accountant or payroll officer submits the returns, due by the 9th of the following month, with complete backing data.
What is the SHIF rate?
SHIF is charged at 2.75% of gross monthly salary, with no upper cap. It is administered by the Social Health Authority and replaced NHIF on 1 October 2024.
Are casual fundis treated differently for deductions?
The deduction depends on the worker's engagement basis and earnings, not simply on the label. FundiPay records the correct basis per worker so the appropriate deductions are applied, and your accountant can review the classification.
Can we see the employer contributions separately?
Yes. The employer's NSSF match and the 1.5% employer housing levy are shown separately from the amounts deducted from the worker, so you can see the true cost of employment per fundi.
Keep reading
Guides
PAYE for Construction Workers
How PAYE works for Kenyan construction crews — tax bands, personal relief, casual daily wages, and the mistakes that trip up site payrolls.
Guides
NSSF Contributions Guide
Tier I and Tier II NSSF contributions explained for construction payroll — rates, earnings limits, casual workers and the monthly deadline.
Guides
SHIF Health Contributions Guide
How SHIF health contributions work in Kenya — 2.75% of gross with no cap, deducted from construction wages and remitted monthly.
Guides
Affordable Housing Levy Guide
The affordable housing levy explained for construction payroll — 1.5% employee plus 1.5% employer, who it applies to and how to avoid penalties.
Guides
Payroll Statutory Calendar
The monthly construction payroll calendar in Kenya: PAYE, NSSF, SHIF and housing levy returns due by the 9th, what to prepare and the cost of lateness.