How SHA Contributions Are Calculated for Employees and Employers in 2026

For salaried employees in Kenya, SHA contributions are generally calculated at 2.75% of gross salary, subject to a minimum contribution of KES 300 per month and currently no upper contribution cap. The math is straightforward. If it sounds simpler than the old NHIF system, that's because it is. The catch is that employers need to get the timing, deduction order and registration right, or employees end up locked out of care.

How the 2.75% formula works

Gross pay means total emoluments — basic + all allowances + overtime + bonuses. Take that number. Multiply by 2.75%. That's the deduction. For an employee on KSh 100,000 gross, SHA is KSh 2,750 a month. For an employee on KSh 500,000 gross, SHA is KSh 13,750 a month.

The minimum floor matters for low earners. 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. There is no ceiling. This is the change that catches people. The old NHIF ceiling of KSh 1,700 is gone; SHA scales with salary.

Simple Monthly Examples: KSh 8,000 gross = KSh 300 (minimum applies); KSh 20,000 = KSh 550; KSh 50,000 = KSh 1,375; KSh 100,000 = KSh 2,750; KSh 250,000 = KSh 6,875. Use SHIF deduction calculator to verify your payslip if the numbers feel off.

The order matters: SHA comes before PAYE

Take NSSF, SHIF (2.75% of gross) and the Housing Levy (1.5% of gross) off the gross. Taxable pay = gross − NSSF − SHIF − Housing Levy. PAYE is then charged on what's left. This was not always clear, and older payroll systems still get it wrong. Payroll systems that forget this understate the employee's take-home by roughly 0.8–1% of gross.

What employers must do

Every employer with staff on payroll must register on the SHA Employer Portal, deduct 2.75% of each employee's gross monthly salary (minimum KES 300, no cap) and pay it to SHA by the 9th of the following month. Registration happens once, but remittance happens every month. Check the SHA portal at sha.go.ke for current login details and access.

They should ensure every employee is registered, show the deduction on payslips, and keep remittance records. Late remittance attracts penalties and can leave employees inactive when they need care. The penalty is not trivial. Late payment attracts a 2% penalty on the unpaid amount for every month it stays unpaid, under Section 27(6) of the Social Health Insurance Act, 2023.

A common slip-up: NHIF numbers did not carry over. 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. Check your team's registration now if you're not sure.

Self-employed and informal sector

For non-salaried households: Contributions are linked to household income assessment (means testing). Minimum contribution remains KSh 300 monthly. The system uses income assessment to determine applicable payments. Self-declared monthly income × 2.75%, minimum KES 300. Pay via paybill 200222 monthly.

Common questions

Higher earners do pay more. Under SHA: KSh 100,000 × 2.75% = KSh 2,750. Because SHA scales directly with income, higher earners may see larger deductions. This is by design. The old band system capped contributions at KSh 1,700 regardless of salary. The new system is proportional.

Check your payslip to confirm the amount is showing. Unlike NSSF which has both employee and employer contributions, SHIF is borne entirely by the employee. The employer's role is to deduct the correct amount and remit it on behalf of the employee. You can verify the calculation yourself. For a KSh 80,000 gross salary, the deduction should be KSh 80,000 × 0.0275 = KSh 2,200.

If you are unsure whether your registration is active, the deadline is 60 days. SHA membership is "active" if you're current within 60 days. After that, you may face trouble accessing services.

An employer who needs help should reach out to a SHA registration experts for guidance on portal setup, or find a verified Kenyan expert on Kaziiko to handle the full payroll stack.

Frequently Asked Questions

Is SHA calculated on gross or net salary?

Gross pay means total emoluments — basic + all allowances + overtime + bonuses. Pre-tax, before any allowable deduction. Salaried employees contribute 2.75% on the gross, not on taxable pay.

What happens if my employer is late with the remittance?

Late payment attracts a 2% penalty on the unpaid amount for every month it stays unpaid, under Section 27(6) of the Social Health Insurance Act, 2023. More importantly, you risk being marked inactive and unable to access care. Push your employer to remit by the 9th.

Do I pay SHA if I earn below KSh 11,000 a month?

Yes. The minimum contribution is KES 300 per month, regardless of salary. 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.

Can I claim back my SHA contributions at tax time?

Since 27 December 2024, both are deducted from pay before PAYE is calculated, the same as NSSF. SHA reduces your taxable income, so the tax benefit is built into your monthly payslip, not claimed later.