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SHIF Contributions Eligible for 15% Tax Relief

Effective October 1, 2024, the Social Health Insurance Fund (SHIF) replaced the National Hospital Insurance Fund (NHIF). All individuals residing in Kenya are required to contribute 2.75% of their gross income to the Social Health Authority, with a minimum monthly contribution of KES 300.

Tax Relief on SHIF Contributions

Contributors to SHIF are eligible for tax relief of 15% on the total contribution amount. This relief is granted under Section 31 and Paragraph 2, Head A of the Third Schedule of the Income Tax Act. However, the total tax relief available for both insurance premiums and SHIF contributions is capped at KShs. 5,000 per month or KShs. 60,000 annually.

Who Needs to Contribute?

  • Employed individuals: Contributions will be automatically deducted from your payroll.
  • Self-employed individuals: Contributions are made directly to the Social Health Authority.
  • Indigent and vulnerable populations: Contributions will be subsidized by the government.

Payment Deadline

All contributions must be made monthly, with the deadline set for the 9th of the following month. Failure to make timely payment of contributions will result in a penalty of 2% of the unpaid amount for the period in question.

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