The National Social Security Fund (NSSF) Act, 2013 has been amended several times by Members of Parliament (MPs). President William Ruto pushed the increase of NSSF rates. Some of the major modifications include introducing new higher rates, extending the contribution base to cover workers in the informal sector, and developing a two-tier system for contributions. The NSSF contribution rates for Kenyan companies and employees will change in February 2025, and workers will face increased deductions. This change is the third stage of the NSSF Act of 2013’s phased implementation, which intends to improve workers’ retirement benefits by progressively raising contribution rates over five years. Kenyans in the formal and informal sectors will contribute to NSSF.
What are lower and upper NSSF limits? The increased rates would further burden households amid harsh economic times by reducing employees’ earnings by up to KSh 1,512. Higher and lower-income limits will be increased by NSSF from KSh 36,000 to KSh 72,000 and KSh 7,000 to KSh 8,000, respectively. The NSSF Act of 2013 states that the highest deduction will increase from KSh 2,160 to KSh 4,320, and the lowest contribution will increase from KSh 420 to KSh 480. “The lower limit earnings for the third year of implementation of the NSSF Act of 2013 will be KSh 8,000, while the upper earning limit will be two times the national average (KSh 72,000),” the act explains. READ ALSO Kenya National Police DT Sacco pays KSh 3.9b dividends, interest for FY2024 Below is the contribution summary in KSh No Salary Tier I NSSF Tier II NSSF Employee contribution Employer contribution Total 1. 500,000 480 3,840 4,320 4,320 8,640 2. 450,000 480 3,840 4,320 4,320 8,640 3. 350,000 480 3,840 4,320 4,320 8,640 4. 300,000 480 3,840 4,320 4,320 8,640 5. 250,000 480 3,840 4,320 4,320 8,640 6. 200,000 480 3,840 4,320 4,320 8,640 7. 150,000 480 3,840 4,320 4,320 8,640 8. 100,000 480 3,840 4,320 4,320 8,640 9. 90,000 480 3,840 4,320 4,320 8,640 10. 80,000 480 3,840 4,320 4,320 8,640 11. 70,000 480 3,740 4,200 4,200 8,400 12. 60,000 480 3,120 3,600 3,600 7,200 13. 50,000 480 2,520 3,000 3,000 6,000 14. 40,000 480 1,920 2,400 2,400 4,800 15. 30,000 480 1,320 1,800 1,800 3,600 16. 20,000 480 720 1,200 1,200 2,400
by Japhet Ruto
