National Health Insurance Fund (NHIF) has started the implementation of the NHIF Amendment Act, 2022.
Acting Chief Executive Officer Samson Kuhora cautioned employers indicating in a public notice that they risked paying the penalties if they failed to match contributions of their workers to the Fund on time.
“As per section 18 (1) of the NHIF Act, employers who fail to remit the employees’ monthly standard contributions by the due date shall be liable to pay a penalty equal to the lending rate of interest of the amount of the contribution, as may be published by the Central Bank of Kenya from time to time,” he said on a public notice on penalty on late contributions.
The new penalties, according to NHIF, will take effect on May 1 and prevent companies from failing to make payments that are due before the specified date in the following month. Self-employed NHIF contributors will now face fewer fines under the new penalties should they fall behind on their contributions.
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The due date for monthly standard contributions is the 9th day of the following month.
Under the NHIF Act of 1998, which was amended in January 2022, defaulters will be required to pay 10% of the contribution. In the past, default fines were assessed at half of the contributor’s amount, or Sh250 every month.
The penalty for individuals who contribute Sh500 would now be Sh50, down from Sh200 under the previous rates, should they default.
“As per Section 19(2) of the NHIF Act, self-employed contributors who fail to pay their monthly contributions by the day when the monthly contributions are due shall be liable to pay equal to 10 per cent of the amount of the contribution,” Kuhora said.