Income Tax Act (cap 470)


Chapter 5

Withholding Tax Rates in Kenya (Third Sch. (para 3&5))

item note Res Non Res Non Res Oil & Gas
Dividend > 12.5% voting power (i) Exempt 10 10
Dividend < 12.5% voting power (i) 15 10 10
Dividend - Qualifying (v) 5
Management or professional fees or training fees (ii) 5 20 12.5
Royalty (iii) 5 20 20
Rent - immovable property 10 30
Rent - movable property 15
Interest or deemed interest of Gov bond >=2yrs 15 15
Interest- Non-Gov bond >=2yrs 25 25
Interest- bond >=10yrs 10
Interest- SEZ 5
Qualifying Interest - Housing bonds (vi) 10
Qualifying Interest - Bearer instruments (vi) 20
Qualifying Interest - Any other case (vi) 15
Commission insurance 5
Insurance premium (or reinsurance (tla 2020)) (fa 2018) 5
Pension / withdrawal in excess of tax free amounts (iv) 10-30% 5
Pension refund to employer 30
Sporting & entertainment or promoting or earning from 20
Gains for ship owner 2.5
Demurrage charges (fa 2018 deleted fa 2019) (vii) 20
Transmitting messages (Telecommunication) 5
>Other Payments (not dividends) by SEZ 10
Natural resource income 5 20
Winnings (tla 2020) 20
sales promotion, marketing, advertising, transportation of goods (tla 2020) (vii) 20


    1. Dividend rate applicable to citizens of the East African Community Partner States in respect of dividend shall be 5% of the gross sum payable;
    2. Rate becomes 15% from April 2020. (tla 2020)
  1. Management, professional fees for
    1. Special economic zone enterprise (SEZ) non resident rate 5%
    2. Consultancy fee East Africa Community (EAC) Partner states 15%
    3. In respect of contractual fee the aggregate value of >= Ksh.24,000 a month, three per cent (3%) of the gross amount payable;
  2. Royalty to a Special Economic Zone Enterprise (SEZ), Developer or Operator to a non-resident person shall be 5% of the gross amount payable;
  3. Pension in excess of the tax free amounts specified under
    1. section 8(4)- exempt kes.300,000/-
    2. section 8(5)- lump sum commuted kes.600,000/-.
    3. section 8(5)- On termination of employment kes.60,000/- per yr upto a maximum of kes.600,000/-.
  4. Qualifying dividend means that part of the aggregate dividend that is chargeable to tax under section 3(2)(b) and which has not been otherwise exempted under any other provision of this Act, but shall not include a dividend paid by a designated cooperative society subject to tax under section 19A(2) or 19A(3);
  5. Qualifying interest means the aggregate interest, discount or original issue discount receivable by a resident individual in any year of income from—
    1. a bank or financial institution licensed under the Banking Act (Cap. 488); or
    2. a building society registered under the Building Societies Act (Cap. 489) which in the case of housing bonds shall not exceed ksh.300,000/- has been approved by the Minister for the purposes of this Act; or
    3. the Central Bank of Kenya:
  6. Excluding air and shipping transport. services @2014-2024 All rights reserved
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