NSSF Contributions in Kenya: Tier I and Tier II Rates Explained for Employers

How NSSF contributions are structured

NSSF contributions are based on an employee’s gross monthly earnings and computed in two tiers. Both the employee and the employer contribute at 6% each, up to the applicable limits.

• ✓Tier I: lower earnings limit of KES 9,000 per month. Employee contributes 6% (up to KES 540) and the employer matches another 6% (up to KES 540).
• ✓Tier II: covers monthly earnings between KES 9,001 and KES 108,000. Employee contributes 6% of the excess over KES 9,000 (up to KES 5,940) and the employer matches it.
• ✓Maximum combined monthly contribution per employee per side: KES 6,480 (KES 540 Tier I + KES 5,940 Tier II).
• ✓The 6% rate is fixed by the NSSF Act, but the lower and upper earnings limits that cap it are advised by NSSF from time to time, so confirm the current ceiling on the NSSF portal before you finalise a payroll.

Employee vs employer responsibility

The employee’s share is deducted from gross salary each pay period. The employer’s share is an additional cost on top of salary. Both amounts are remitted together by the employer through the NSSF channels and must be reflected correctly in payroll records.

Common NSSF payroll mistakes

• ✓Applying Tier I on the full salary instead of capping at KES 9,000.
• ✓Forgetting Tier II for employees earning above KES 9,000.
• ✓Using the old flat-rate scheme when the earnings-based structure applies.
• ✓Omitting the employer share when reconciling payroll costs.

saloPoint handles Tier I and Tier II automatically

saloPoint computes NSSF Tier I and Tier II for every employee based on the statutory earnings limits, separates employee and employer shares, and includes the figures in your payroll records and reports. You simply configure each employee’s gross salary — the statutory math is handled for you.