If you paid July salaries before implementing the Finance Act 2023 changes, then these are the steps to recover the July Housing Fund and PAYE Differences (for salaries above Kshs.500,000) from August salaries.
(You’ll need this Excel file for calculating PAYE Difference. Download and save it: PAYE_Diff_Calc_July2023.xlsx )
Video on how to recover: How to recover HF and PAYE Differences from August 2023 payroll
These are the steps shown in the video above:
1. Export your July 2023 Housing Fund figures to Excel.
(Steps 2 to 4 are only relevant if you have employees with a salary above Kshs.500,000. If not, skip to step 5)
2. Export your July Taxable Pay Figures to Excel.
3. Use July Taxable Pay figures to calculate PAYE differences for those with salaries above Kshs.500,000 using the provided Excel sheet (download link at the top of this page).
4. Add up the HF and PAYE Difference figures.
5. Activate a Voluntary Deduction Pay Type to use to post the recoveries. Or use an already active one.
(Make sure you are not using the same Pay Type for any other entry.)
6. Import the recovery figures from Excel into your August 2023 payroll.
(If you have already used the “VolDed: Recovery” Pay Type, see this video: How to Rename and Activate a Customizable Pay Type)
7. Process Payslips for August 2023 to update the payslips for the imported recoveries.
8. Check to confirm the recoveries are in the payslips and have reduced Net Pay.
That’s it, you are done.