On Tuesday, 19th March 2024, Kenya’s President signed into law The Affordable Housing Act, 2024, which amends the legislation which originally implemented the Affordable Housing Levy in 2023 in the Finance Act, 2023.
The Act requires employees to contribute 1.5% of their gross monthly salary, matched by their employers, into the Affordable Housing Fund.
The Act requires employers to remit this to the KRA (the collector on behalf of the Affordable Housing Fund) by the 9th of the following month.
Please note that this information is based on a copy of the Affordable Housing Act, 2024, available in general circulation, which has not yet been confirmed as the copy assented to by the President. We wait to receive the version published in the Kenya Gazette
The KRA also published a notice (see below) to inform employers that effective 19 March 2024, employers must remit this using tab M of the iTax file.
The employee contribution toward the Affordable Housing Levy is also allowed as a tax deduction in terms of the Third Schedule of the Income Tax Act, however, currently the P10 iTAX file does not make provision to allow this deduction on the payroll, we have escalated this to the KRA for clarification. Once more information is available it will be communicated. https://www.kra.go.ke/news-center/public-notices/2099-collection-of-the-affordable-housing-levy-by-kenya-revenue-authority-2