Taxation

Over 70 per cent of annual national budget funding comes from local taxes collected by the Kenya Revenue Authority.

The tax system features:

  • corporate and personal income tax
  • value added tax on goods and services
  • customs and excise duties
  • stamp duty.

There are also a number of statutory levies and social security payments.

Corporation tax is a form of income tax that is levied on companies. Resident companies are taxable at a rate of 30 per cent while non-resident companies are taxable at a rate of 37.5 per cent.

Withholding taxes are deducted 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.

Taxes are collected by self-assessment and by withholding tax on payments to residents and non-residents. Employers are obliged to withhold and account for income tax on employee remuneration and benefits - Pay-as-you-earn (PAYE). Penalties and interest on non-compliance and late payment of taxes are onerous and the Kenya Revenue Authority conducts regular audits and investigations of taxpayers.

Visit Kenya Revenue Authority for further information.