Turnover Tax is a tax charged on businesses whose gross turnover is more than KES 1,000,000 but less than KES 50,000,000 in any given year.

Not sure whether you must submit Income Tax Return? We have made it easier for you to comply. #Payand File.

Did you know that Section 5A (2) of the Kenya Revenue Authority Act of 1995 introduced a reward of KES 500,000 to any person who provides information, that leads to enforcement of tax laws?

That is; where the information provided leads to the identification of unassessed duties or taxes identified, whichever is less.

where the information provided leads to the recovery of unassessed duties or taxes. This law stipulates a reward of KES 2 million or 5% of the taxes or duties recovered, whichever is less.

Log on to https://iwhistle.kra.go.ke/welcome/and report any corruption or tax related crimes.

Taxation of rental income under the annual regime

• Rent is charged on the actual amount received.
• Expenses incurred to generate rent are allowed under section 15 of the Income Tax Act.
• Tax is calculated under the annual individual graduated scale or corporate rate of 30%.
• Rent on non-residential buildings(Commercial) is a taxable supply under the VAT Act(No.35 of 2013)- Laws of Kenya.

Who qualifies for monthly rental income?

• Any resident person (individual or company).
• The tax applies to rental income earned for the use or occupation of a residential property.
• Landlords earning residential rental income of between Kshs 288,000 p.a and Kshs. 15M p.a.

The digital service tax will be paid by the digital service provider whether overseas or locally in Kenya. The provider of the digital service will file a return and pay the DST. Overseas entities can appoint a tax representative in Kenya to register, file, and pay digital service tax on their behalf.

For a taxpayer to qualify for a waiver application all the principal taxes must be fully paid before an application can be lodged for consideration for a waiver. To qualify for a waiver, the taxpayer has to be compliant in all taxes concerning filing and payment of taxes. The applicant's past compliance record is taken into account when processing the waiver application.

The Residential Rental Income upper threshold has been increased from KES 10 million to KES 15 Million per annum. 

The lower threshold has been also increased from KES 144,000 to KES 288,000 per annum to align with the current lower individual tax band. 

This is aimed at providing an opportunity for more landlords to comply with the simplified regime which has minimal compliance costs. 

Forwarded parcels may be re-assessed if the owner disputes the tax values and produces the actual invoice/receipt to determine actual values of the items. During assessment, the customer produces the transaction value/invoice/declared value if they have none.

Different items attract different rates. The taxes payable include import duty 0%, 10%, 25%,   VAT-14%, Excise duty 10% or calculated depending on the item, Import Declaration   Form (IDF)  3.5% and Railway Development Levy (RDL)  2% .

Voluntary Disclosure Program (VDP) is meant to provide an avenue for taxpayers with undisclosed income to disclose the same without undue imposition of punitive penalties and interest. It is aimed at improving revenue collection by bringing more taxpayers from the underground economy into the tax net.