SHA replaces NHIF in Kenya: what employers must do in 2026

On 1 October 2024, every Kenyan private-sector payroll had to change two lines at once. The Social Health Authority (SHA) replaced NHIF under the Social Health Insurance Fund (SHIF) Act 2023, and the Affordable Housing Levy (AHL) — which had been wobbling between court orders since March 2024 — became a settled, stand-alone statutory deduction. Neither change is optional, neither maps cleanly onto the old NHIF line, and both are enforced harder than the schemes they replaced.

If your payroll spreadsheet still has "NHIF" in a cell, you have a problem. Here's what actually runs through a Kenyan payslip in 2026.

The headline change

Line	Before (up to 30 Sep 2024)	After (from 1 Oct 2024)
Health	NHIF — graduated table from KSh 150 to KSh 1,700 based on gross band	SHA — 2.75% of gross pay, minimum KSh 300, no upper cap
Housing	None (or AHL in-out under litigation)	AHL — 1.5% employee + 1.5% employer of gross pay
Remittance	NHIF portal	SHA portal (separate from NHIF); AHL via KRA iTax
Registration carry-over	NHIF number re-used	New SHA registration required for every member

1. SHA — the new health contribution

SHA replaced NHIF as the single national health insurer. The change is not cosmetic — contribution base, rate, cap, and remittance all moved.

The numbers:

SHA = 2.75% of gross pay, minimum KSh 300/month, no upper cap, remitted monthly.

Gross pay means total emoluments — basic + all allowances + overtime + bonuses. Pre-tax, before any allowable deduction. For an employee on KSh 100,000 gross, SHA is KSh 2,750/month. For an employee on KSh 500,000 gross, SHA is KSh 13,750/month. The old NHIF ceiling of KSh 1,700 is gone; SHA scales with salary.

Allowable deduction: SHA contributions are deductible from taxable income before PAYE from January 2025 under the SHIF Act. Payroll systems that forget this understate the employee's take-home by roughly 0.8–1% of gross.

Registration: every employee needs an SHA number. NHIF numbers did not carry over automatically — employers had to re-register the workforce through the SHA member portal. If you onboarded staff between October 2024 and early 2025 and skipped the SHA registration step, those employees are currently remitting into an unmatched account and cannot access benefits.

Remittance: monthly, by the 9th of the following month, via the SHA portal. Late remittance attracts a penalty of 2% per month on the unpaid amount (unchanged from NHIF's penalty structure).

2. Affordable Housing Levy — the employer-matched deduction

AHL is a split levy: 1.5% is withheld from the employee, 1.5% is paid by the employer on top. Total 3% of gross pay leaves the business each month per employee.

The numbers:

AHL = 1.5% of gross pay (employee) + 1.5% of gross pay (employer), remitted monthly via KRA iTax.

Base is gross pay — the same base as SHA, not the same as NSSF (which uses pensionable pay with a cap). Getting the bases confused is the most common 2024–2026 payroll reconciliation error we see.

For the same KSh 100,000-gross employee:

Line	Base	Rate	Monthly
AHL — employee	Gross 100,000	1.5%	1,500
AHL — employer	Gross 100,000	1.5%	1,500
Total cost to the business	—	—	3,000

Across a 50-person workforce at an average KSh 120,000 gross, AHL alone costs the employer side KSh 90,000/month — KSh 1.08M/year — that was not on a 2023 payslip.

Allowable deduction: AHL (employee side) is deductible from taxable income before PAYE from January 2024.

Remittance: monthly via KRA iTax, same deadline as PAYE (9th of the following month). Late remittance attracts the standard KRA penalty framework.

3. The full 2026 Kenyan statutory stack

Stacking SHA and AHL alongside the other statutory lines, a KSh 250,000-gross Kenyan employee now sees:

Line	Base	Rate	Monthly (KSh)
NSSF Tier I (employee)	First 8,000	6%	480
NSSF Tier II (employee)	Up to 72,000 cap	6%	3,840
SHA (employee)	Gross 250,000	2.75%	6,875
AHL (employee)	Gross 250,000	1.5%	3,750
PAYE (after reliefs and allowable deductions)	Taxable income	Bracketed	≈ 62,900
Total employee-side monthly	—	—	≈ 77,845

Employer-side adds 6% + 6% NSSF (capped) and 1.5% AHL — roughly KSh 7,590/month on top for this employee, before pension top-ups.

See our Kenyan PAYE guide for how these feed into the chargeable-income calculation.

4. NITA — the levy most employers forget

Sitting alongside SHA and AHL is the NITA industrial training levy: KSh 50 per employee per month, employer-only, remitted annually. Small, but non-zero; if you have 50 employees, that's KSh 30,000/year that a compliance audit will find and penalise at 50% interest.

Common mistakes in the SHA + AHL transition

1. Keeping "NHIF" as a payslip line. The scheme no longer exists. A payslip still showing NHIF misleads the employee and flags a cold audit the minute SHA sees mismatched remittance metadata.
2. Applying the old NHIF table to SHA. SHA is percentage-based (2.75%), not graduated. The KSh 1,700 NHIF ceiling does not exist in SHA.
3. Computing SHA or AHL on basic salary. Both are on gross pay. Using basic under-remits by roughly 20–40% depending on the salary structure.
4. Skipping SHA re-registration. NHIF numbers did not carry across. Employees onboarded post-October 2024 need explicit SHA registration; otherwise their contributions sit in a holding account and cannot be claimed against benefits.
5. Forgetting AHL is matched by the employer. The 1.5% employee deduction is half the story; the 1.5% employer match is a real P&L line.
6. Treating AHL and SHA as the same deduction. They go to different regulators via different portals. One late SHA remittance and one on-time AHL remittance is still one compliance failure — SHA won't credit you for AHL's punctuality.
7. Ignoring AHL's allowable-deduction status. It reduces taxable income before PAYE. Missing this is a silent over-deduction of PAYE every month.

Historical context: the NHIF era

Pre-October 2024 — kept here for reference only:

• NHIF Act 1998 (as amended) set the original graduated contribution table
• Flat bands from KSh 150 (low income) to KSh 1,700 (high income), capped
• Separate health-insurer registration via the NHIF portal

Every clause of that Act touching private-sector payroll contribution was superseded by the SHIF Act 2023 on 1 October 2024. Payroll for September 2024 still cites NHIF; payroll for October 2024 onward cites SHA.

Does AnooreHR handle this?

Yes — AnooreHR treats SHA, AHL, NSSF, and NITA as profile-driven deductions in the Kenya country pack. Rates, bases, minimum floors, and the NSSF upper-limit schedule all live in JSON profile files — no code change when KRA or SHA revise parameters. The Kenya payslip renders each line to its correct regulator column, and both halves of AHL (employee + employer) post to the right GL accounts.

Kenya is on AnooreHR's 2026 country rollout, pending local accountant sign-off before general availability. If you run Kenyan payroll and want to see the SHA + AHL flow end-to-end, book a demo and we'll walk through a live payslip alongside the Nigeria product that's already shipping.