Withholding Tax Rates

Income
Resident

payee
Notes
Non-resident payee
Management, professional and training fees
5%
(1)
20%*
Management Fees paid by SEZ to non-resident
5%
Royalties ( Natural resource)
5%
20%*
Royalties paid by SEZ to non-residents
5%
Leasing equipment  other than Immovable
Nil
15%
Dividend<12.5% voting power
5%*
(3)
5%/10%*
               >12.5% voting power
Exempt
10%
Interest from financial institutions – Bank
15%
(4)
15%*
Interest on Govt  bearer bonds with maturity of ≥ 2 years
15%
15%
Interest on Govt  bearer bonds with maturity of ≥10 years
10%
15%
Interest on  other bearer certificates
25%

/20%*
(4&5)
25%*
Housing bond interest
10%*
(4&5)
15%*
Rents-immovable property
10%%*
 (6)
30%*
Pension and taxable withdrawals from pension/provident funds
10%-25%*
(7)
5%*
Insurance commissions
10%
(8)
20%*
Insurance and reinsurance premiums
N/A
(9)
5%
Contractual fees
3%
20%
Consultancy fees- Citizens of EAC member countries
5%
(10)
20%*
 Surplus pension fund withdrawals
30%
30%
Telecommunication services/message transmission -VSAT
5%
Lottery/ betting winnings (w.e.f 1 Jan 2014)
20%
20%
Payments to sportsmen and entertainers
5%
20%
Supporting, assisting or arranging an appearance or performance

 
N/A
20%
Sales promotion, marketing, advertising services, and transportation of goods (excluding air and shipping transport services)

 
N/A
20%
Gains from business of non-resident aircraft or ship-owner
2.5%
Sale of property or shares in oil, mining or mineral prospecting companies
10%
20%
Dividends- oil and gas sector
10%
Interest- Oil and gas sector
15%
Management and professional fees- Oil and gas sector
12.5%
Payments to subcontractors-oil and gas
5.625%

* means that the withholding tax is final, always the case for non residents

  • Training fees includes all incidental costs.
  • 5% applicable to East African citizens from 15 June 2007.
  • This applies only to individuals. The resident rate is as shown but is not a final tax for corporations. The rate for resident individuals from other bearer instruments is 20% final tax.
  • Limited to income of sh. 300,000 p.a.
  • -only withholding tax agents appointed by the Commissioner to withhold tax on rental income which does not exceed KES 15,000,000 and is more than KES 288,000 per annum
  • This rates apply only on the graduated PAYE tax rates (for early withdrawal) or in bands of sh. 400,000 (for withdrawals after a 15 year period or at 50 years of age)
  • 5% is paid to a resident broker.
  • Insurance/reinsurance premium paid in respect of aircraft is exempt
  • If fees are in excess of sh. 24,000 per month when paid to a resident person. Rate applicable on payment in respect of consultancy fees to citizens of the East Africa Community Partner states shall be 15%.

Note: Lower rate may apply there is a tax treaty in force. The countries with which Kenya has  signed double tax treaties with are UK, German, Canada, Denmark, Norway, Sweden, Zambia, and India.