Pay & working terms · 3 min read
SHIF deduction in Kenya: how much SHA takes from your salary
The SHIF rate on salaried pay, how to work out the deduction, why it matters that your employer remits on time, and how it affects PAYE.
Since the Social Health Insurance Fund replaced NHIF in October 2024, the health deduction on a payslip is a percentage of pay instead of a fixed band. That makes it easy to check yourself. Here is the rate set by the Social Health Authority, the law behind it, and what to do if the money is deducted but does not reach SHA.
The rate: 2.75 per cent of gross monthly salary
The Social Health Authority sets contributions at 2.75 per cent of gross monthly income, deducted from gross salaries for people in employment. SHA states a minimum of KSh 300 a month and no upper limit.
Employers calculate the deduction and remit it to SHA. Unlike NSSF and the housing levy, SHA's rate page describes no matching employer contribution for salaried members.
Gross salary KSh 25,000: 2.75% = KSh 687.50. Gross salary KSh 40,000: 2.75% = KSh 1,100. Gross salary KSh 120,000: 2.75% = KSh 3,300. There is no cap, so the deduction keeps rising with pay.
Gross means gross
Because SHIF is worked out on gross pay, your allowances count, not only basic salary. If your gross pay changes because of overtime or commission, the deduction changes with it. A payslip that shows SHIF calculated on a different base is worth a question to payroll.
Why late remittance hurts you, not only the employer
Section 27(4) of the Social Health Insurance Act says a person can only access healthcare services under the Act where their contributions are up to date and active. If your employer deducts the money but does not pay it, your cover can show as inactive when you need treatment.
Section 27(6) adds a penalty of 2 per cent of the amount due for the period it stays unpaid.
- Check your status through SHA's official channels after each pay day, especially before planned treatment.
- Keep every payslip showing the SHIF deduction.
- If the deduction appears on the payslip but not with SHA, raise it with HR in writing and keep the reply.
SHIF and PAYE
From December 2024 the Tax Laws (Amendment) Act, 2024 made SHIF contributions an allowable deduction when working out taxable employment income, according to KRA's public notice. In practice, payroll subtracts SHIF before applying the PAYE bands, so a higher SHIF deduction slightly lowers your PAYE.
Registration comes first
Section 26 of the Act requires every Kenyan to register as a member of the Fund. If you are starting your first job, register through SHA's official channels and give your employer the details it asks for. Never pay anyone who offers to register you or activate cover for a fee outside SHA's own channels.
Sources and further reading
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Frequently asked questions
How much is the SHA deduction from salary?
2.75 per cent of gross monthly salary, according to the Social Health Authority, with a stated minimum of KSh 300 a month and no upper limit.
Does my employer pay part of SHIF?
SHA's premium rate page describes the salaried contribution as 2.75 per cent deducted from gross salary and remitted by the employer. It does not describe a matching employer share.
Why is my SHA cover inactive when SHIF was deducted?
Under section 27(4) of the Social Health Insurance Act, access depends on contributions being up to date. If your employer deducted but did not remit, raise it with HR in writing and keep your payslips as proof.
Does SHIF reduce PAYE?
Yes. KRA's notice on the Tax Laws (Amendment) Act, 2024 lists SHIF contributions as deductible when working out taxable employment income.