, pub-7771400403364887, DIRECT, f08c47fec0942fa0 KRA Seals Fate of Kenyans' August Salaries with Affordable Housing Levy

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KRA Seals Fate of Kenyans' August Salaries with Affordable Housing Levy

Amidst a series of recent developments in the business and domestic sectors, the Kenya Revenue Authority (KRA) has made an important announcement regarding the homeownership dreams of Kenyan citizens. The Affordable Housing Levy (AHL), which had been temporarily suspended following the Finance Act 2023, has now been reinstated by the Court of Appeal.

Following this decision, KRA has confirmed that employers are required to deduct the AHL from employees' gross salaries and remit the levy for both July and August. As a resu

lt, employees may experience a double deduction in their August salaries. This move aims to fulfill the government's commitment to providing affordable housing solutions for Kenyan citizens.

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KRA, acting as the official collecting agent for the AHL, has been entrusted with the responsibility of ensuring compliance with the levy. The Cabinet Secretary, Ministry of Lands, Public Works, Housing, and Urban Development, Zacharia Macharia, appointed KRA through a public notice on August 2, 2023.

Employers are now required to deduct 1.5% of the employee's gross monthly salary, while contributing an additional 1.5% of the employee's monthly gross salary themselves. The collected funds must be declared under sheet "M" of the Pay As You Earn (PAYE) return on the iTax platform.

To facilitate the payment process, employers should generate a payment slip using the "agency revenue" tax head and "Housing Levy" sub-head. The payments can be made through KRA agent banks or mobile money.

Failure to comply with the AHL regulations will result in penalties for employers. In case of non-payment, the employer will incur a penalty equivalent to two percent of the unpaid funds for each month the payment remains outstanding.

The reinstatement of the AHL signifies the government's commitment to addressing the housing needs of Kenyan citizens. While the double deduction in August salaries may cause temporary financial strain for employees, it is a necessary step toward realizing the vision of affordable housing for all.

For more information and updates, employers and employees are encouraged to visit the KRA website and familiarize themselves with the AHL guidelines.

In conclusion, the Affordable Housing Levy is a crucial initiative that aims to create sustainable homeownership opportunities for Kenyans. By ensuring compliance with the levy, the government is working towards improving the living standards of its citizens and promoting economic growth in the country.

Disclaimer: This article is intended for informational purposes only and should not be construed as legal or financial advice. Readers are advised to consult with relevant authorities or seek professional counsel to understand their individual obligations and rights regarding the Affordable Housing Levy.

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