The Kenya Revenue Authority (KRA) has issued a public notice to clarify the applicability of insurance relief for contributions made to the Social Health Insurance Fund (SHIF), following the enactment of the Social Health Insurance Act.
The notice aims to address confusion about whether SHIF contributions qualify for insurance relief under the Income Tax Act.
According to KRA, insurance relief under the Income Tax Act applies only to health insurance policies started on or after January 1, 2007, or contributions made to the National Health Insurance Fund (NHIF).
The NHIF was originally covered under the National Health Insurance Fund Act, which has since been replaced by the Social Health Insurance Act.
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The notice specifies that contributions to the SHIF under the new act do not qualify for insurance relief as currently provided under the Income Tax Act.
However, an amendment has been proposed in the Tax Laws (Amendment) Bill, 2024, to allow deductions of SHIF contributions from taxable income, which would extend tax relief benefits to SHIF contributions if approved.
For further clarification, taxpayers are encouraged to reach out to the KRA Contact Centre at 020 4 999 999, 0711 099 999, or via email at callcentre@kra.go.ke.
This clarification by KRA ensures that taxpayers understand the current limitations on tax relief for SHIF contributions, pending possible legislative changes.
