The Teachers Service Commission (TSC) has clarified why thousands of teachers received higher Pay-As-You-Earn (PAYE) deductions in their June salaries, attributing the increase to the correction of a payroll system error that emerged after recent tax law changes.
In a statement issued on Thursday, the commission said the anomaly occurred during the reconfiguration of the Integrated Personnel and Payroll Database (IPPD) following the implementation of the Tax Laws (Amendment) Act, 2024.
The clarification follows widespread complaints from teachers who reported unexpected reductions in their June pay slips and questioned why the commission had not communicated the changes in advance.
Payroll error linked to tax law changes
According to TSC, the amendments to the Income Tax Act exempted employee contributions to the Affordable Housing Levy (AHL) Fund and the Social Health Insurance Fund (SHIF) from income tax, requiring adjustments to the government’s payroll system.
However, while implementing the changes, National Social Security Fund (NSSF) contributions—which were already configured as tax-exempt—were mistakenly captured for tax relief a second time.
The duplication resulted in an incorrect calculation of PAYE for all TSC employees.
“During the system reconfiguration process, an unintended anomaly occurred whereby NSSF contributions, which had already been configured as tax-exempt, were inadvertently recaptured for tax relief purposes,” the commission said.
Correction reflected in June payroll
TSC said the error was subsequently identified and corrected in the June 2026 payroll for both teachers and commission staff.
The adjustment resulted in higher PAYE deductions as the payroll system reverted to the correct tax computation required under the law.
“The PAYE adjustment reflected in the June 2026 payroll arose from the correction of the payroll system configuration and was necessary to ensure accurate computation of Pay As You Earn deductions going forward,” the commission said.
The agency added that the correction was intended to ensure future salary payments comply fully with tax regulations.
Teachers raised concerns
The clarification comes after many teachers reported noticing higher deductions in their June salaries, with some estimating an average increase of about KSh108 in PAYE.
The unexpected deductions sparked concern among teachers, many of whom argued that the commission should have informed employees before implementing the payroll adjustments.
Commission apologises
TSC acknowledged that the adjustments may have caused anxiety among employees and apologised for the inconvenience.
“The Commission regrets any inconvenience or concern that this adjustment may have caused to TSC employees and appreciates their understanding,” the statement said.
The commission maintained that the changes do not represent a new tax but rather the correction of a payroll processing error to ensure deductions are calculated accurately in line with existing tax laws
