Staff PENSION Scheme/Fund
The benefits that it can provide are as follows:-
• A member receives periodic pension payments on retirement.
• Up to one-third of the of the total accrued benefits as at retirement date can be received in lump sum, the balance is then utilised to purchase annuity/pension.
• If a member leaves service early, a deferred pension or a lump sum can be granted.
• In the event of the death of a member, a pension scheme can provide benefits to the dependents.
Staff PROVIDENT Scheme/Fund
• the objective of the scheme is to provide lump sum benefit to an employee when he leaves service early or at the date of his retirement or in the event of his unfortunate death, to his legal heirs.
• A provident scheme is the most flexible and wide-ranging type of retirement benefits scheme since one has the option of either receiving his total accrued benefits in lump sum or utilises the benefits to purchase annuity/pension.
Basic features of both Schemes/Funds
• If a member leaves service early, a deferred pension or a lump sum can be granted.
• In the event of the death of a member, benefits are become payable to the beneficiaries/dependants.
• Tax Benefits & Contributions
1. Employee will get income tax relief on his contributions (tax deductible limit of Kshs 20,000 per month)
2. Employers contributions will go as expenditure to the Company.
Investment Income
The Investment income of the scheme is exempted from tax.
• Taxation of Withdrawal Benefits
In the case of a withdrawal from a registered Retirement Benefit Scheme upon termination of employment after less than 15 years of membership, the first Kshs. 48,000.00 lump sum payment for each year of service subject to a maximum of Kshs. 480,000 is not subject to tax in the hands of recipient. The balance is taxed as follows:-
10% First Kshs. 121,968.00
15% Next Kshs. 114,912.00
20% Next Kshs. 114,912.00
25% Next Kshs. 114,912.00
30% any excess over Kshs. 466,704.00
Withdrawal from a registered Retirement Benefit Scheme upon termination of employment after more than 15 years of service, on early retirement basis at age 50 or after age 50 on retirement due to ill health or infirmity, the first Kshs. 48,000 lump sum payment for each year of service up to a maximum of Kshs. 480,000.00 is not subject to tax in the hands of recipient. The balance is taxed as follows:-
10% First Kshs. 400,000.00
15% Next Kshs. 400,000.00
20% Next Kshs. 400,000.00
25% Next Kshs. 400,000.00
30% any excess over Kshs. 1,600,000.00
Upon the death of an employee who is a member or beneficiary of a registered provident fund, the widow or the widower or the dependents shall qualify as a group for the same tax exempt amounts out of lump-sum, as if such amounts had been received by the employee.
• Vesting
The Retirement Benefits Act and Regulations requires that an employee be 100% vested of Employer’s contribution after completing 1 year of service. If he leaves before completing 1 year of service, he will be entitled to his own contributions plus interest.
• Leaving Service prior to Retirement Age:
A member can not withdraw from the Fund while still in the service of the Founder/Sponsor.
If a member leaves before the retirement age, he may opt for one of the following:-
• Leave his benefits in the scheme and receive a deferred pension purchased at the time of normal retirement.
• Transfer the accumulated contributions to a registered scheme of his new employer or to an individual retirement fund.
• Receive a refund of his contributions plus accrued interest thereon subject to the tax.
Kenindia’s Specialties:-
While general features of administration and management of a pension / provident fund scheme remains the same irrespective of the Fund manager, the following attributes separate Kenindia from rest of the lot and invites esteemed clients to select Kenindia as the Institution of their choice.
1. Being a Guaranteed fund, it offers guarantee of paying a minimum basic interest of 4% annually on the fund, which, other Fund managers would not offer.
2. The interest credited to the fund is net and still attractive compared to prevailing rates offered by our competitors.
3. Annual Statements
We provide individual statements to the members showing the following particulars:-
i) Fund at the beginning of the year
ii) Interest earned by the fund during the year
iii) Contributions received during the year
iv) Interest earned by the contributions on day to day basis during the year.
v) Fund at the end of the year
We also provide consolidated fund statements showing the above particulars to the Trustees.
Why invest with Kenindia?
• Absolute safety of funds (With fast payment track record and customer friendly services )
• Highest returns
2002 10.50%
2003 9.25%
2004 8.50%
2005 10%
2006 11%
2007 11%
2008 9.5%
2009 11%
2010 12%
• Fast settlement of claims
• Fund Management & Administration fees – Negotiable.
Other fees: Statutory fees for RBA Levy and Audit.