YolaworksNSSF Tier I & II and the Housing Levy in 2026
Two deductions on every Kenyan payslip often cause confusion: NSSF, which now runs across two tiers up to a KES 72,000 ceiling, and the Affordable Housing Levy at 1.5%. Both come off before PAYE. Here's how each works, with the numbers.
NSSF: 6% across Tier I and Tier II
The National Social Security Fund is a retirement contribution. Under the enhanced NSSF structure, the employee contributes 6% of pensionable pay, split across two tiers, and the employer matches it with another 6%.
- Tier I covers pensionable pay up to the lower earnings limit.
- Tier II covers pay between the lower and the upper earnings limit of KES 72,000.
Because contributions are capped at the KES 72,000 upper limit, the maximum employee NSSF deduction is KES 4,320 per month (6% of 72,000). The employer pays a matching KES 4,320, so KES 8,640 in total goes to the fund for a high earner.
| Gross monthly pay (KES) | Employee NSSF (6%) |
|---|---|
| 30,000 | 1,800 |
| 50,000 | 3,000 |
| 72,000 | 4,320 (cap reached) |
| 150,000 | 4,320 (capped) |
| 300,000 | 4,320 (capped) |
Notice how NSSF stops rising once pay passes KES 72,000 — everyone above that ceiling contributes the same KES 4,320.
The Affordable Housing Levy: 1.5%
The Housing Levy funds Kenya's affordable housing programme. It is 1.5% of the employee's gross pay, deducted from the employee, with the employer contributing a matching 1.5%. Unlike NSSF, there is no cap — the levy keeps rising with salary.
| Gross monthly pay (KES) | Housing Levy (1.5%) |
|---|---|
| 30,000 | 450 |
| 50,000 | 750 |
| 85,000 | 1,275 |
| 150,000 | 2,250 |
| 300,000 | 4,500 |
Both reduce PAYE. NSSF and the Housing Levy are allowable deductions, so they come off gross pay before PAYE is calculated. That is why getting these right matters for the whole payslip — see the full order of operations in our PAYE guide.
Employer obligations
- Match and remit. Employers deduct the employee share, add their matching share, and remit both to NSSF and the Housing Levy collector by the statutory deadline (the 9th of the following month).
- Register employees. Every employee needs an NSSF number; new joiners must be registered before their first deduction.
- Budget for the employer share. Remember the employer contribution is a real cost on top of gross salary — roughly 6% (NSSF, capped) plus 1.5% (Housing) of payroll.
See NSSF and the Housing Levy on any salary
The free calculator shows both, alongside SHIF, PAYE and net pay.
Open the calculator →How Yolaworks handles NSSF & the Housing Levy
Yolaworks payroll applies the NSSF tiers and the KES 72,000 cap, the 1.5% Housing Levy, and the matching employer shares automatically — then feeds them into PAYE in the correct order and produces remittance summaries for each cycle. It also shows you the true cost of employment, employer contributions included. Try it free for 30 days, no payment needed.
NSSF limits and the Housing Levy can change by regulation or Finance Act. Figures here reflect the 2026 position at the time of writing; confirm current limits before filing.