Ghana Income Tax 2026.What Are The New PAYE Rates? What Changed & What It Means for You.
If you work in Ghana, or you run a business that pays salaries, something changed on September 1, 2026 that directly affects how much money lands in your bank account every month.
The Ghana Revenue Authority (GRA) has updated the income tax Pay As You Earn (PAYE) rates under the Income Tax (Amendment) Act, 2026 (Act 1178). Some employees will see a slight increase in take-home pay while others, particularly senior executives, will see a meaningful reduction.
Here is what changed, what it means in cedi terms, and what employers need to do right now.
First, What Is PAYE and How Does It Work?
PAYE stands for Pay As You Earn. It’s the income tax that gets deducted from your salary every month before your employer pays you.
It works on a sliding scale, that is the more you earn, the higher the percentage you pay. But crucially, the higher rate only applies to the portion of your income above each threshold, not your entire salary.
One more thing before we get into numbers: PAYE is not calculated on your full gross salary. Your 5.5% SSNIT pension contribution is deducted first, and PAYE is applied to what is left.
In essence: Gross Salary → Less SSNIT (5.5%) → PAYE Applied to the Balance
What Changed: Old Rates vs New Rates
Here is the direct comparison. The bands on the left are what was in place before. The bands on the right are what applies from September 1, 2026:
Monthly Income Tax Bands
| Band | Old Rate | New Rate |
|---|---|---|
| First GHS 490 | 0% | First GHS 588 → 0% |
| Next GHS 110 | 5% | Next GHS 80 → 5% |
| Next GHS 130 | 10% | Next GHS 100 → 10% |
| Next GHS 3,000 | 17.5% | Next GHS 2,900 → 17.5% |
| Next GHS 16,395 | 25% | Next GHS 16,000 → 25% |
| Exceeding GHS 20,000 | 30% | Next GHS 30,332 → 30% |
| — | — | Exceeding GHS 50,000 → 35% (NEW) |
The biggest change: A brand new 35% band for monthly income above GHS 50,000. Previously, 30% was the highest rate. This new band targets senior executives, directors, and business owners drawing high salaries.
For most employees, the changes are relatively modest, the tax-free band increased slightly (from GHS 490 to GHS 588 per month), which is a small benefit.
What This Looks Like in Real Cedis
Let us take three real examples so you can see the actual impact.
Example 1: Junior Staff – GHS 3,000/month gross salary
SSNIT deduction: GHS 3,000 × 5.5% = GHS 165
Chargeable income: GHS 3,000 − GHS 165 = GHS 2,835
| Band | Amount Taxed | Tax |
|---|---|---|
| First GHS 588 | GHS 588 | GHS 0.00 |
| Next GHS 80 at 5% | GHS 80 | GHS 4.00 |
| Next GHS 100 at 10% | GHS 100 | GHS 10.00 |
| Next GHS 2,067 at 17.5% | GHS 2,067 | GHS 361.73 |
| Total PAYE | GHS 375.73 |
Take-home pay: GHS 3,000 − GHS 165 (SSNIT) − GHS 375.73 (PAYE) = GHS 2,459.27
Under the old rates, PAYE on this salary was approximately GHS 404.60. Thankfully, this employee actually takes home slightly more under the new bands.
Example 2: Mid-Level Manager — GHS 8,000/month gross salary
SSNIT: GHS 8,000 × 5.5% = GHS 440
Chargeable income: GHS 7,560
| Band | Amount Taxed | Tax |
|---|---|---|
| First GHS 588 | GHS 588 | GHS 0.00 |
| Next GHS 80 at 5% | GHS 80 | GHS 4.00 |
| Next GHS 100 at 10% | GHS 100 | GHS 10.00 |
| Next GHS 2,900 at 17.5% | GHS 2,900 | GHS 507.50 |
| Next GHS 3,892 at 25% | GHS 3,892 | GHS 973.00 |
| Total PAYE | GHS 1,494.50 |
Take-home pay: GHS 8,000 − GHS 440 − GHS 1,494.50 = GHS 6,065.50
Example 3: Senior Executive — GHS 60,000/month gross salary
This is where the new 35% band kicks in.
SSNIT: GHS 60,000 × 5.5% = GHS 3,300
Chargeable income: GHS 56,700
| Band | Amount Taxed | Tax |
|---|---|---|
| First GHS 588 at 0% | GHS 588 | GHS 0.00 |
| Next GHS 80 at 5% | GHS 80 | GHS 4.00 |
| Next GHS 100 at 10% | GHS 100 | GHS 10.00 |
| Next GHS 2,900 at 17.5% | GHS 2,900 | GHS 507.50 |
| Next GHS 16,000 at 25% | GHS 16,000 | GHS 4,000.00 |
| Next GHS 30,332 at 30% | GHS 30,332 | GHS 9,099.60 |
| Remaining GHS 6,700 at 35% | GHS 6,700 | GHS 2,345.00 |
| Total PAYE | GHS 15,966.10 |
Take-home pay: GHS 60,000 − GHS 3,300 − GHS 15,966.10 = GHS 40,733.90
Under the old rates (where 30% was the maximum), this employee’s PAYE would have been approximately GHS 13,621.10 — a difference of over GHS 2,300/month in additional tax.
What Employers and Payroll Officers Must Do Now
If you process payroll for a business in Ghana, this is your action list:
1. Update your tax bands immediately.
Whether you use payroll software, a spreadsheet, or a third-party provider, the new bands must be in place for September 2026 payroll and every month going forward.
2. Check whether your software has been updated.
Don’t assume. Log in, find where the PAYE bands are configured, and verify they match the table above. If your software provider hasn’t issued an update, contact them.
3. Review any high earners specifically.
If you have employees or directors earning above GHS 50,000 per month in chargeable income, their PAYE will increase significantly under the new rules. Notify them before they see an unexpected change on their payslip.
4. Recalculate for September payroll.
The effective date is September 1, 2026. If September payroll has not been finalised, use the new rates. If it has already been processed with the old rates, you will need to make a correction on the next run and adjust the GRA remittance accordingly.
5. Keep your records.
When GRA reviews payroll records, they look at whether the correct rate was applied for each month. Under-deductions are the employer’s liability, not the employee’s.
The Modified Taxation Scheme (MTS) Also Changed
The GRA notice also updated the threshold for the Modified Taxation Scheme, a simplified flat-rate tax for small businesses and self-employed individuals.
Under the new rules, if your annual business turnover is more than GHS 20,000 but does not exceed GHS 750,000, you’re in the MTS bracket and pay a flat 3% presumptive tax on your annual turnover.
This replaces the previous threshold and is particularly relevant for traders, sole proprietors, artisans, and small service businesses that operate outside the corporate tax structure.
Download Resource: 2026 PAYE Rate Schedule
Access the official reference document and schedule for your enterprise.