SHIF Health Contributions Guide

The Social Health Insurance Fund, administered by the Social Health Authority, replaced the National Hospital Insurance Fund from 1 October 2024. Where NHIF used fixed contribution bands based on income, SHIF is a percentage of earnings. The practical effect is that the deduction now moves with the wage — a fundi on a strong month contributes more, and a contractor cannot use last month's figure for this month's payslip.

• Administered by the Social Health Authority.
• Replaced NHIF with effect from 1 October 2024.
• Calculated as a percentage of gross, not a fixed income band.

SHIF is charged at 2.75% of gross monthly salary, and there is no upper cap on the earnings it applies to. Gross means gross — before PAYE and before other deductions — so the calculation starts from the full wage, not the net. Because there is no ceiling, a site with highly paid supervisors or a crew working heavy overtime generates a larger SHIF total than many contractors expect from their old NHIF experience. For a quick sanity check, take 2.75% of your gross wage bill for the month — the total should match, no more and no less.

SHIF is deducted from each worker's wages as part of the monthly payroll and remitted to the authority, with the return due by the 9th of the following month, alongside the other statutory deductions. For casual crews, the deduction must be recalculated on each pay run from actual gross earnings, because a flat monthly figure will be wrong the moment attendance changes. Because the charge is a percentage rather than a band, the only inputs you need are gross pay and the rate — which is exactly what a payroll system already holds. FundiPay applies the 2.75% rate per worker as payroll runs, issues the digital payslip showing the deduction, and produces the figures for the monthly return.

SHIF is a worker-facing deduction: a fundi who cannot access healthcare cover, or who finds a gap in their contributions, will raise it immediately. Under-deducting exposes the employer to arrears; over-deducting is money taken from a worker's pocket and is just as damaging to trust. Because the calculation is a simple percentage of gross, the only real risk is using a stale or estimated figure — which is why the deduction should always come from the same payroll that produced the wage.