What SHA is and how it replaced NHIF
The Social Health Authority (SHA) is the body that took over from the National Hospital Insurance Fund (NHIF) from October 2024, under Kenya health reforms. The fund that collects contributions is the Social Health Insurance Fund (SHIF). In everyday conversation people still say NHIF, but the current deduction on a payslip is SHIF, remitted to SHA.
The biggest practical change is the rate structure. NHIF used a graduated table where the deduction depended on which salary band an employee fell into. SHIF replaced that with a single percentage: 2.75% of gross monthly pay, with a minimum contribution of KES 300 for lower earners. This makes the payroll calculation simpler, because there is no band lookup, just one percentage.
SHIF is an employee deduction that the employer withholds from pay and remits. It is separate from PAYE, NSSF and the Affordable Housing Levy, each of which goes to its own body by its own deadline. Every employer with staff on a payroll must deduct SHIF and remit it on time.
How to calculate and remit SHA (SHIF) contributions
Work out the deduction for each employee, then remit the total to SHA.
- 1
Step 1: Take gross monthly pay
Start from the employee gross pay for the month, before deductions. SHIF is charged on gross, not on taxable pay.
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Step 2: Apply 2.75%
Multiply gross pay by 2.75%. For a gross of KES 60,000 that is KES 1,650. For a gross of KES 100,000 it is KES 2,750.
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Step 3: Apply the minimum
If 2.75% of gross is below KES 300, deduct the KES 300 minimum instead. For a gross of KES 10,000, 2.75% is 275, so the minimum of 300 applies.
- 4
Step 4: Deduct from the payslip
Withhold the SHIF amount from the employee pay and show it as a separate line on the payslip, distinct from PAYE, NSSF and the Housing Levy.
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Step 5: Remit to SHA by the 9th
Total the SHIF deductions across all employees and remit to SHA by the 9th of the following month, with the by-employee return.
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Step 6: Keep the records
Keep the payslips and remittance confirmations. Clean payroll records make audits and employee queries straightforward.
Common SHA and NHIF mistakes employers make
Still using the old NHIF bands
Payrolls that were never updated still deduct on the graduated NHIF table. That over-deducts some staff and under-deducts others. The correct basis is a flat 2.75% of gross with a KES 300 minimum.
Charging SHIF on taxable pay instead of gross
SHIF is 2.75% of gross pay, not of taxable pay after other deductions. Using the wrong base understates the contribution.
Forgetting the minimum
For low earners, 2.75% can be below KES 300. The minimum of KES 300 applies, so do not deduct less.
Mixing SHIF into the PAYE payment
SHIF goes to SHA, not to KRA. Lumping it with the iTax PAYE payment sends money to the wrong body and leaves SHIF unpaid.
Missing the 9th
Like PAYE and NSSF, SHIF is due by the 9th of the following month. Late remittance can attract penalties, so pay on time.
An employer works out SHIF for three staff
A salon in Nairobi has three staff: gross pay of KES 10,000, KES 45,000 and KES 80,000.
For the KES 10,000 earner, 2.75% is 275, below the minimum, so SHIF is KES 300. For the KES 45,000 earner, 2.75% is KES 1,237.50. For the KES 80,000 earner, 2.75% is KES 2,200.
The owner deducts each amount on the payslip, totals them (300 + 1,237.50 + 2,200 = KES 3,737.50) and remits that to SHA by the 9th, alongside the separate PAYE, NSSF and Housing Levy remittances. Because the rate is a single percentage, the calculation takes seconds per employee.
An unmonitored till is the quietest leak in Kenyan retail: small shortfalls and unrecorded sales add up long before anyone thinks to look.
Veira gives each staff member their own login and a full audit trail, so every sale, void and refund is tied to a name.
How Veira handles SHA contributions in payroll
Veira payroll applies the current SHIF rate of 2.75% of gross with the KES 300 minimum automatically for every employee, alongside PAYE, NSSF and the Housing Levy, so each deduction is correct and shown clearly on the payslip. No band lookups, no outdated NHIF tables.
Because payroll runs in the same system as your sales and eTIMS, your whole compliance picture stays consistent and remittances are easy to reconcile, from KES 2,999 a month.
Frequently asked questions
Is it still NHIF or is it SHA now?
How much is the SHA contribution in Kenya?
Is SHIF calculated on gross or net pay?
When are SHA contributions due?
Does the employer also contribute to SHIF?
How is SHIF different from the old NHIF?
SHA changed how every Kenyan employer deducts health contributions: a single 2.75% of gross replaced the old NHIF bands. Getting it right is a small monthly task, but only if your payroll is on the current rules. Veira applies the correct SHIF, PAYE, NSSF and Housing Levy automatically, from KES 2,999 a month. Try the SHIF calculator or book a free demo.