WHAT DOES NSSF CONTRIBUTION MEAN?

 

Contribution is that portion of an employee’s salary is sent to the NSSF fund. The new law (NSSF amendment Act) says that there are now 3 forms of contribution that an employee can make to NSSF that is standard contribution, voluntary contribution and special contribution. 

STANDARD CONTRIBUTION 

This is what the law requires an employee to make. This is 5% of the monthly salary of an employee. This is collected from the salary of the employee.  

SPECIAL CONTRIBUTION 

The law requires an employer to contribute a share to what each employee saves with NSSF. This amount should be 10% of the employee’s monthly salary. This is not removed from the salary of an employee but from the funds of the employer. This is added to the standard contribution of an employee and sent to NSSF together to make a monthly contribution of 15% of the employee’s salary.  

VOLUNTARY CONTRIBUTION 

If you are employed, and you are already making contributions to NSSF (those are standard contributions), the law allows you as an employee to choose to make a bigger contribution to what you save with NSSF. In order to do this, an employee has to write to his/her employer and ask him to deduct an agreed amount and send it to NSSF. 

If you are also self-employed, and you choose to contribute to the NSSF fund, then your contribution will also be called a voluntary contribution.

📷:Freepik