NAIROBI, Kenya, Aug 4 – The Kenya Revenue Authority (KRA) has directed employers to deduct the Affordable Housing Levy contributions from employees salaries.
In a public notice, the Authority wants employers to remit it’s 1.5 percent contribution alongside a similar rate for their employees as well.
The move by KRA follow the announcement by the Lands Ministry backdating the mandatory contributions as proposed in the Finance Act, 2023.
“With effect from 1st July, 2023, all employers are required to deduct the AHL from the employee’s gross salary and remit together with the employer’s contribution,” the authority’s Commissioner for Domestic Taxes said in a statement on Friday.
“KRA wishes to further clarify that all employers are required to declare the AHL under sheet ‘M’ of the PAYE return on itax and generate a payment slip under the tax head ‘agency revenue’ and tax sub-head ‘Housing Levy’ and make payments at KRA agent banks or mobile money.” the authority stated in a notice.
KRA further indicated that employers who fail to remit the deductions shall be liable to payment of a penalty equivalent to two per cent of the unpaid funds for every month until they comply with the law.
The government backdated the payments after the Appellate Court last week temporarily lifted conservatory orders barring the implementation of the contentious Finance A.
