The Kenya Revenue Authority (KRA) has issued a directive to employers to deduct the Affordable Housing Levy (AHL) from employee’s salary effective 19 March, this year, following the signing into law the Affordable Housing Bill by President William Ruto early this week.
- The Affordable Housing Act, 2024 designates KRA as the ‘Collector’ of the Affordable Housing Levy (AHL).
- It requires all Employers to deduct the AHL from the employee’s gross salary and remit together with the employer’s contribution.
- Employees pay 1.5 per cent of their gross monthly salary which then is marched by another 1.5 per cent of the employee’s monthly gross salary by the employer.
“Any person who fails to comply with the law shall be liable to payment of a penalty equivalent to three per cent (3 per cent) of the unpaid funds for every month if the same remains unpaid,” KRA said in a notice.
All other persons who receive income or whose income is accrued in Kenya are required to remit 1.5 per cent of their gross income as the Affordable Housing Levy to KRA.
The due date for remittance of Affordable Housing Levy is the 9th working day after the end of the month in which the gross salary was due or gross income was received or accrued.
All employers are required to declare the AHL under sheet “M” of the PAYE return on iTax, 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 through eCitizen Paybill Number. 222 222 or by dialing *222#.
Lands and Housing Cabinet Secretary Alice Wahome said the project has so far employed 120,000 people, adding that 300,000 people would be working in various construction sites across Kenya by the end of the year.
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