| Taxable Income (KSh) |
Tax Rate % |
| 0 - 1,34,164 |
10% |
| 1,34,165 - 2,60,567 |
15% |
| 2,60,568 - 3,86,970 |
20% |
| 3,86,971 - 5,13,373 |
25% |
| 5,13,373 and Above |
30% |
| Taxable Income (KSh) |
Tax Rate % |
| 0 - 1,21,968 |
10% |
| 1,21,968 - 2,36,880 |
15% |
| 2,36,880 - 3,51,792 |
20% |
| 3,51,792 - 4,66,704 |
25% |
| 4,66,704 and Above |
30% |
Income Tax Department administers various direct taxes, which have different rates:
PAYE is a method of collecting tax at source from individuals in gainful employment. The employer deducts a certain amount of tax from his / her employee's salary or wages on each payday then remit the tax to the Authority. This relieves the employee from paying taxes at the end of the year and shifts the responsibility to the employers.
Every individual who receives income is granted a tax
credit or a tax relief from the Authority, this is known
as Personal Relief. Insurance relief and mortgage relief
are also available for eligible persons. The total tax
credit is spread evenly during the charge year. At the
end of the year, an individual will submit his
self-assessment on total income received from various
sources. Should the tax credit be lower than actual tax
charged during the year, the balance of tax due will be
payable.
Corporation tax is a form of income tax that is levied on companies. Resident companies are taxable at a rate of 30% w.e.f year of income 2000 while non - resident companies are taxable at a rate of 37.5%.w.e.f year of income 2000.
Withholding taxes are deducted at source from the following sources of income: Interest, dividends, royalties, management or professional fees, commissions, pension or retirement annuity, rent, appearance or performance fees for entertaining, sporting or diverting an audience.
Advance tax is applicable to Matatus and other Public Service Vehicles. It is not a final tax, but a tax partly paid in advance before a public service vehicle or a commercial vehicle is registered or licensed.
The current rates are:
For vans, pickups, trucks and lorries Kshs.1, 500 per ton of load capacity per year or Kshs.2, 400 whichever is higher.
For saloons, station wagons, mini-buses, buses and coaches, Kshs.60 per passenger capacity per month or Kshs.2, 400 whichever is higher
Lowest Individual Tax Rate is 10% and Highest Rate is 30%
| Taxable Income (KSh) |
Tax Rate % |
| 0 - 121,968 |
10% |
| 121,968 - 236,880 |
15% |
| 236,880 - 351,792 |
20% |
| 351,792 - 466,704 |
25% |
| 466,704 and Above |
30% |
Management and professional fees, training fees, royalties and performance fees 20%
Use of immovable property 30%
Use of other property 15%
Interest 15%
Dividends 10%
Pensions and retirement annuities 5%
Telecommunication service fees 5%
Sales of property or shares in oil-mining or mineral-prospecting companies 20%
These rates normally constitute the final liability for Kenyan income tax.
The corporate tax rate is 30%. The corporate tax rate for branches is 37.5%. Profits after tax are subject to 5% or 10% withholding tax, for residents and non-residents respectively, when distributed as dividend. Export processing zone enterprises are exempt from corporate tax for the first 10 years and subsequently enjoy a reduced tax rate of 25% for the next 10 years. Newly listed companies, approved under the Capital Markets Authority enjoy reduced corporation tax rates depending on the percentage of shares floated to the public. Informal businesses with turnover above five hundred thousand Kenya shillings but not exceeding five million Kenya shillings in a year of income pay a turnover tax of 3% which is a final tax.
Kenya does not impose a capital gains tax. Property transfers are subject to stamp duties at a rate of 4% on urban property and a rate of 2% on rural property.
Resident individuals are required to file a self-assessment
return by 30 June following the end of the previous calendar
year.
Nonresidents are required to file tax returns only if they
receive taxable income that is not subject to withholding tax.
If required to file, nonresidents must follow the procedures
described for residents.