Kenya Revenue Authority (KRA) has now directed employers to backdate the Housing Levy of employees from July 2023.
KRA which stands as the collection agent of the contribution will now oversee employers deduct 1.5% from the employees gross salary and match it up.
“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.
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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.” said KRA
Employers who fail to submit the contribution will face a 2% penalty every month until when they comply with the regulation.
The news comes days after the court lifted a staying order issued against the Finance Act 2023 following a successful appeal by Busia Senator Okiya Omtatah last month.
Azimio has also challenged the move by the government calling for the need to first prioritize the high cost of living.