A resident individual shall be entitled to insurance relief at the rate of 15% of premiums paid subject to maximum relief amount of Kshs. 5,000 per month (or Kshs. 60,000 per annum) if he proves that;-
— he has paid premium for an insurance made by him on his life, or the life of his wife or of his child and that the Insurance secures a capital sum, payable in Kenya and in the lawful currency of Kenya; or
— his employer paid premium for that insurance on the life and for the benefit of the employee which has been charged to tax on that employee; or
— both employee and employer have paid premiums for the insurance:
Provided that;-
— No relief shall be granted in respect of part of premium for an insurance which secures a benefit which may be withdrawn at any time at the option of the insured.
— Premiums paid for an education policy with a maturity period of at least 10 years shall qualify for relief.
— Only premiums paid in respect of an insurance policy taken on or after 1st January, 2003 shall qualify for relief.
NOTE:
Employees must avail to the employer a certificate from insurer showing particulars of the policy e.g. name of insured, type of policy, capital sum payable, maturity date, premiums payable and commencement date of the policy.
Employers should review their pay-rolls towards the end of the year and make necessary adjustments to ensure that the correct relief had been granted. No relief is available in respect of insurance policy that elapsed in the course of the year.
i. Employer shall attach a copy of the certificate furnished by insurer, confirming premiums paid and that the policy was still in force to the employee’s P9A, P9B, P9A (HOSP) Tax deduction Card for that year.
ii. For the purposes of insurance relief “child” include a step child and an adopted child who was under the age of eighteen years on the date the premium was paid.