Corporate - Taxes on corporate income

Last reviewed - 26 September 2022

Resident companies are taxable in Kenya on income accrued or derived from Kenya. Resident
companies with business activities outside Kenya are also taxed on income derived from
business activities outside of Kenya.

Non-resident companies are subject to Kenya corporate income tax (CIT) only on the trading
profits attributable to a Kenyan PE (price-to-earnings ratio).

The rate of CIT for resident companies, including subsidiary companies of foreign parent
companies, is 30%. The CIT rate for branches of foreign companies and PEs is 37.5%.

Special rates
There are special rates for certain resident and non-resident companies as set out below.

Entity CIT rate (%)

Export processing zone (EPZ) enterprises:  

First ten years 0

Next ten years 25

Thereafter 30

Registered unit trusts/Collective investment schemes Exempt (subject to conditions)

Companies listed on securities exchange 25 (first five years)

Special economic zone (SEZ) enterprises, developers, 10 (first ten years);

and operators 15 (succeeding ten years)

15 (first five years);

Local motor vehicle assembly companies 15 (succeeding five years,
subject to conditions)

Company operating a carbon market exchange or 15 (first ten years from the year
emission trading system that is certified by the Nairobi of commencement of its
 Entity CIT rate (%)

International Financial Centre Authority operations)

15 (first ten years from the year

Company operating shipping businesses of commencement of its
operations)

Rates on gross income of non-residents derived from

 
Kenya:

Transmission of messages 5

Ownership or operation of ships and aircraft 2.5

Demurrage charges 2.5

Local income taxes

There are no county or provincial taxes on income, as all taxes are collected by the national
government. However, county governments are empowered by the Constitution to impose
property and entertainment taxes at the county level.