Last updated: March 2026 · Rates effective 2026 tax year
Side-by-Side Comparison
| Category | 🇳🇬 Nigeria | 🇰🇪 Kenya |
|---|---|---|
| Tax Authority | FIRS | KRA |
| Currency | NGN (₦) | KES (KSh) |
| Tax Bands | 6 bands (7%–24%) — NTA 2026 | 5 bands (10%–35%) |
| Top Marginal Rate | 24% LOWER | 35% |
| Entry Rate | 7% | 10% |
| Tax-Free Threshold | CRA relief (20% of gross + ₦200k min) | KES 24,000/mo CLEARER |
| Pension (Employee) | 8% of basic | ~6% NSSF Tier I+II (capped) |
| Health / SHIF | NHF 2.5% (housing) | SHIF 2.75% of gross |
| Housing Levy | None | AHL 1.5% of gross |
| Personal Relief | CRA (variable) | KES 2,400/month fixed |
| Fiscal Year | January – December | January – December |
| Tax Returns | Self-assessment via FIRS | iTax portal (KRA) |
Tax Band Comparison
🇳🇬 Nigeria NTA 2026 Bands
| Annual Income (₦) | Rate |
|---|---|
| First 800,000 | 7% |
| Next 1,600,000 | 11% |
| Next 3,200,000 | 15% |
| Next 6,400,000 | 19% |
| Next 12,800,000 | 21% |
| Above 24,800,000 | 24% |
🇰🇪 Kenya KRA 2026 Bands
| Monthly Income (KES) | Rate |
|---|---|
| First 24,000 | 10% |
| 24,001 – 32,333 | 25% |
| 32,334 – 500,000 | 30% |
| 500,001 – 800,000 | 32.5% |
| Above 800,000 | 35% |
Take-Home Pay Examples
Comparing equivalent purchasing-power salaries (approximate USD conversion at ₦1,600/USD and KES 130/USD).
At ~$300/month (₦480K NGN / KES 39K)
🇳🇬 Nigeria — ₦480,000/mo
Pension (8%): ~₦19,200
NHF (2.5%): ~₦800
🇰🇪 Kenya — KES 39,000/mo
NSSF: ~KES 1,080
SHIF (2.75%): ~KES 1,073
AHL (1.5%): ~KES 585
At ~$625/month (₦1M NGN / KES 81K)
🇳🇬 Nigeria — ₦1,000,000/mo
Pension (8%): ~₦40,000
NHF (2.5%): ~₦1,667
🇰🇪 Kenya — KES 81,000/mo
NSSF: ~KES 2,160
SHIF (2.75%): ~KES 2,228
AHL (1.5%): ~KES 1,215
Detailed Analysis
Nigeria's NTA 2026 Reform
Nigeria's PAYE system underwent a major overhaul with the Nigeria Tax Act 2026, which replaced the Personal Income Tax Act (PITA). The new NTA abolished the Consolidated Relief Allowance (CRA), lowered the top rate from 24% to 24% (unchanged), but restructured the bands to reduce the burden on lower earners. The new 7% entry rate (down from 7% under PITA for the first ₦300K) now applies to the first ₦800,000 of taxable income annually — a significant expansion of the low-rate band.
Pension contributions of 8% (employee) + 10% (employer) on basic salary are mandatory under the Pension Reform Act 2014 and remain the same under NTA 2026. The National Housing Fund (NHF) at 2.5% of basic salary applies to formal sector workers.
Kenya's Finance Act 2024 Changes
Kenya's PAYE calculator must reflect the Finance Act 2023/2024 changes which introduced the Affordable Housing Levy (AHL) at 1.5% and transitioned health contributions from NHIF to SHIF at 2.75% of gross salary. The NSSF Act 2023 also reformed pension contributions to a Tier I + Tier II structure — though implementation has faced legal challenges.
Kenya's personal relief of KES 2,400/month (KES 28,800/year) provides a clear, fixed tax rebate. This is simpler than Nigeria's CRA formula but may be less generous for very high earners with significant variable allowances.
Social Security Burden Comparison
When you add up all mandatory deductions, Kenya's total employee burden is heavier at equivalent salary levels due to SHIF + AHL + NSSF layered on top of PAYE. At KES 81,000/month, the total deduction rate is approximately 22% versus Nigeria's approximately 16% at the equivalent ₦1M salary. For employers, Nigeria's 10% pension contribution is comparable to Kenya's employer-side AHL + NSSF obligations.
Which Country Is Better for High Earners?
Nigeria's lower top rate of 24% makes it substantially more attractive for very high earners compared to Kenya's 35%. A senior executive earning ₦10M/month in Nigeria pays a top marginal rate of 24%; the KRA equivalent would attract 30–35%. However, Nigeria's informal deductions (state levies, development levies) can narrow this gap in practice. For professionals comparing the two markets, Nigeria's formal tax burden is lower at every income level, but Kenya's stronger legal framework and lower cost of compliance are factors to consider.
Frequently Asked Questions
Does Nigeria or Kenya have a higher income tax rate?
Kenya has a higher top marginal rate at 35% versus Nigeria's 24% under NTA 2026. However, Kenya's PAYE entry rate (10%) is higher than Nigeria's (7%), so low earners also pay more in Kenya proportionally.
How does Nigeria's pension compare to Kenya's NSSF?
Nigeria requires 8% employee + 10% employer pension on basic salary under the PRA 2014. Kenya's NSSF 2023 Act requires Tier I + Tier II contributions, capped at approximately KES 2,160/month for employees — making Nigeria's pension a larger percentage of salary for most workers.
Does Kenya have a housing levy that Nigeria doesn't?
Yes. Kenya introduced the Affordable Housing Levy (AHL) at 1.5% of gross salary (matched by employer) under the Finance Act 2023. Nigeria has no equivalent national housing levy, though NHF applies specifically for housing fund purposes.
How do health contributions compare?
Kenya's SHIF charges 2.75% of gross salary with no cap. Nigeria's NHF (2.5% of basic) serves as a housing fund, not a health scheme — Nigeria has the NHIS but it is not a mandatory PAYE deduction for most formal sector workers.
Can I use one calculator for both countries?
AfroTools has separate dedicated calculators: the Nigeria PAYE Calculator covers NTA 2026 and old PITA, and the Kenya PAYE Calculator covers all KRA bands including SHIF, AHL, and NSSF Tier I+II.