By FNJ & Associates | Last updated: 30 October 2026
Types of taxes in Kenya, 2026. Kenya’s main taxes fall into four groups: taxes on income (corporate tax at 30%, PAYE at 10% to 35%, withholding, rental income and turnover tax), taxes on consumption (VAT at 16% and excise duty), payroll levies (SHIF, NSSF and the housing levy) and customs duties on imports. Stamp duty and county charges sit alongside them.
Kenya’s tax system combines taxes on income, taxes on consumption, payroll levies, customs duties and transaction taxes, most of them administered by the Kenya Revenue Authority (KRA). This guide gives an overview of the main types of taxes in Kenya, with the current headline rate, who pays, and when each is due, and links to our detailed guides on each tax. Rates and deadlines reflect the position after the Finance Act, 2026, which took effect on 1 July 2026.
Types of taxes in Kenya at a glance
| Tax | Headline rate | Who pays | When due |
|---|---|---|---|
| Corporate income tax | 30% | Resident companies; branches of non-resident companies | Instalments in months 4, 6, 9 and 12; return within 6 months of year end |
| PAYE | 10% to 35% (graduated) | Employees, deducted by employers | 9th of the following month |
| Withholding tax | 0.5% to 30%, by type of payment | Deducted by the payer | Within 5 working days of deduction |
| Monthly rental income tax | 7.5% of gross rent | Resident landlords with residential rent of KES 288,000 to KES 15 million a year | 20th of the following month |
| Turnover tax | 1.5% of gross sales | Resident businesses with turnover of KES 1 million to KES 25 million | 20th of the following month |
| Capital gains tax | 15% | Persons transferring property situated in Kenya | On or before transfer of the property |
| VAT | 16% standard; 8% on fuel; 0% zero-rated | Businesses with taxable supplies of KES 5 million or more in 12 months | 20th of the following month |
| Excise duty | Specific or percentage rates by product | Manufacturers, importers and suppliers of excisable goods and services | 20th of the following month |
| Social Health Insurance Fund (SHIF) | 2.75% of gross salary | Employees and other contributors | 9th of the following month |
| Affordable Housing Levy | 1.5% employee plus 1.5% employer | Employees and employers | Within 9 working days after month end |
| NSSF | 6% employee plus 6% employer, up to the earnings limit | Employees and employers | 9th of the following month |
| Import duty | 0%, 10%, 25% or 35% (EAC Common External Tariff) | Importers | Before release of goods |
| Stamp duty | 4% urban and 2% rural property transfers | Buyers or transferees | On execution of the instrument |
Want this table on one page? Download the types of taxes in Kenya PDF (free).
Taxes on income
Corporate income tax
Resident companies are taxed at 30% on income accrued in or derived from Kenya and on income from business carried on outside Kenya. Branches of non-resident companies are also taxed at 30% on the profits of their Kenyan permanent establishment. Reduced rates apply to qualifying Export Processing Zone and Special Economic Zone enterprises, certified Nairobi International Financial Centre companies and start-ups, local motor vehicle assemblers and shipping companies. Tax losses can be carried forward for up to five years. Read more in our guide to corporate income tax in Kenya.
Pay As You Earn (PAYE)
PAYE is income tax on employment income, deducted by the employer each month. Resident employees are taxed on their worldwide employment income at graduated monthly rates of 10% on the first KES 24,000, 25% on the next KES 8,333, 30% up to KES 500,000, 32.5% up to KES 800,000 and 35% above that, less a personal relief of KES 2,400 a month. SHIF, Affordable Housing Levy and pension contributions (within limits) are deducted before PAYE is calculated. Non-resident employees are taxed only on income from employment in Kenya. See our guide to statutory payroll deductions in Kenya.
Withholding tax
Withholding tax is deducted at source by the payer from specified payments to non-employees, including management and professional fees, contractual fees, dividends, interest, royalties, commissions, rent and payments to non-residents. Rates range from 0.5% to 30% depending on the payment and whether the recipient is resident. For some income, such as qualifying dividends and interest received by resident individuals, the withholding is a final tax. Withholding tax must be remitted within five working days of the deduction. Our withholding tax guide sets out the full rate table.
Instalment tax
Companies, and individuals whose tax liability for the year exceeds KES 40,000, pay tax in four instalments during the year, on the 20th day of the 4th, 6th, 9th and 12th months. From 1 July 2026, individuals whose only income is employment income taxed under PAYE are not required to pay instalment tax.
Rental income tax
Resident landlords whose gross residential rent is more than KES 288,000 but not more than KES 15 million a year pay monthly rental income tax at 7.5% of gross rent, as a final tax. Landlords outside that band, and those with commercial property, are taxed under the normal rules on net rental income through the annual return, and tenants appointed by KRA withhold 10% on commercial rent paid to resident landlords. From 1 July 2026, rent earned by non-resident landlords from property in Kenya is subject to a final tax on gross rent under the Finance Act, 2026. See our guide to monthly rental income tax in Kenya.
Turnover tax
Turnover tax is a simplified tax of 1.5% of gross sales for resident businesses with annual turnover of more than KES 1 million and not more than KES 25 million. It is filed and paid monthly by the 20th day of the following month, and replaces the annual income tax computation for qualifying businesses. Read more in our turnover tax guide.
Capital gains tax
Capital gains tax is charged at 15% on the gain made when property situated in Kenya, such as land, buildings or unlisted shares, is transferred. The Finance Act, 2026 extended it to non-residents that sell interests in foreign entities deriving their value from property in Kenya.
Significant Economic Presence tax
Significant Economic Presence tax applies to non-residents that provide services to users in Kenya through the internet or an electronic network, such as digital platforms and online service providers. It replaced the Digital Service Tax from 27 December 2024 and works out at an effective rate of 3% of gross turnover.
Domestic minimum top-up tax
Members of multinational groups with consolidated annual revenue of at least EUR 750 million pay a top-up tax where the group’s effective tax rate in Kenya is below 15%, in line with the OECD global minimum tax rules. The older 1% minimum tax on turnover has been repealed.
Fringe benefit tax
Employers that give employees, directors or their relatives loans at an interest rate below the market rate published by KRA pay fringe benefit tax on the difference, at the corporate tax rate. The tax is payable by the employer even if the employer is otherwise exempt from tax.
Advance tax
Owners of commercial vehicles, such as public service vehicles and goods vehicles, pay advance tax annually before the vehicle’s inspection or licensing. The amount depends on the type and capacity of the vehicle, and it can be credited against the owner’s income tax for the year.
Taxes on consumption
Value Added Tax (VAT)
VAT is charged on taxable supplies of goods and services made in Kenya and on imports. The standard rate is 16%, petroleum fuels are currently taxed at a reduced rate of 8%, and zero-rated supplies such as exports are taxed at 0%. Exempt supplies carry no VAT. Registration is compulsory once taxable supplies exceed KES 5 million in a 12-month period, all tax invoices must be issued through eTIMS, and appointed VAT withholding agents withhold 2% of the taxable value when paying suppliers. Read our guides to VAT in Kenya and VAT returns.
Excise duty
Excise duty is charged on the local manufacture, importation and supply of specified goods and services, including alcoholic drinks, tobacco, fuel, sugar, certain imported building and plastic products, telephone and internet data services, fees charged by financial institutions and betting. Rates are set per product in the Excise Duty Act, either as a percentage of value or as an amount per unit, and are reviewed in the annual Finance Act. Licensed manufacturers and suppliers file monthly by the 20th day of the following month.
Betting, gaming and lottery taxes
Betting and gaming are taxed through excise duty on amounts staked or deposited and through withholding tax on winnings. From 1 July 2026, the Finance Act, 2026 reinstated withholding tax of 20% on winnings.
Payroll levies and contributions
- Social Health Insurance Fund (SHIF): 2.75% of gross salary with no upper limit and a minimum of KES 300 a month, remitted to the Social Health Authority.
- Affordable Housing Levy: 1.5% of gross salary from the employee, matched by 1.5% from the employer, remitted to KRA.
- National Social Security Fund (NSSF): 6% of pensionable earnings from the employee and 6% from the employer, up to the upper earnings limit of KES 108,000 a month from February 2026, giving a maximum of KES 6,480 each.
- NITA levy: KES 50 per employee per month, paid by the employer.
Customs and border taxes
Imported goods attract import duty under the East African Community Common External Tariff, generally at 0%, 10%, 25% or 35%, with higher rates for some sensitive products. Most imports also pay an Import Declaration Fee of 2.5% and a Railway Development Levy of 2% of the customs value, plus VAT and, where applicable, excise duty. Specified products also attract the Export and Investment Promotion Levy. Our guide to import duty in Kenya explains how these combine.
Stamp duty
Stamp duty is charged on instruments such as transfers of property, leases and transfers of shares. The main rates are 4% on transfers of property in urban areas, 2% on transfers of property in rural areas and 1% on transfers of unlisted shares. Transfers of shares listed on the Nairobi Securities Exchange are exempt.
County charges
County governments also collect land rates, business permit fees and other charges under county legislation. These are separate from national taxes administered by KRA and vary from county to county.
Main tax deadlines in Kenya
- 9th of each month: PAYE, SHIF, NSSF and NITA for the previous month (Affordable Housing Levy within 9 working days).
- 20th of each month: VAT, turnover tax, monthly rental income tax and excise duty.
- Within 5 working days of each deduction: withholding tax.
- 20 April, 20 June, 20 September and 20 December: instalment tax for December year ends.
- 30 April: individual income tax returns, starting with 2026 income (due 30 April 2027).
- Six months after year end: company income tax returns.
Our tax calendar for Kenya lists every deadline and the penalties for missing them. Taxpayers with old arrears should also note the tax amnesty reinstated by the Finance Act, 2026, which waives interest, penalties and fines for periods up to 31 December 2025 where the principal tax is paid by 31 December 2026.
Frequently asked questions
What are the main types of taxes in Kenya?
The main taxes are corporate income tax, PAYE, withholding tax, VAT, excise duty, import duty, capital gains tax, turnover tax, monthly rental income tax and stamp duty, together with payroll contributions such as SHIF, NSSF and the Affordable Housing Levy.
What is the corporate tax rate in Kenya?
30% for resident companies and for branches of non-resident companies, with reduced rates for qualifying investors in special economic zones, export processing zones and certified sectors.
What is the VAT rate in Kenya?
The standard rate is 16%. Petroleum fuels are currently taxed at a reduced rate of 8%, exports and other zero-rated supplies are taxed at 0%, and exempt supplies carry no VAT. Registration is compulsory once taxable supplies exceed KES 5 million in a 12-month period.
When are tax returns due in Kenya?
PAYE and payroll levies are due by the 9th of the following month; VAT, turnover tax and monthly rental income tax by the 20th; withholding tax within five working days of each deduction; company returns within six months of the year end; and individual returns by 30 April, starting with 2026 income.
Which taxes does a small business in Kenya pay?
Most small businesses deal with turnover tax or income tax, VAT once taxable sales pass KES 5 million a year, payroll taxes and levies for any employees, withholding tax on certain payments, and county business permits. All businesses must issue eTIMS invoices.
How many types of taxes are there in Kenya?
There is no fixed count, but the main taxes fall into four groups: taxes on income, taxes on consumption, payroll levies and customs duties, plus stamp duty and county charges. The table above lists each with its rate.
How FNJ & Associates can help
FNJ & Associates helps businesses and individuals register for the right taxes, file returns on time, claim the reliefs available and respond to KRA reviews. See our tax advisory services in Kenya, or if you run a small or growing business, our accounting services for SMEs in Kenya, from bookkeeping and tax to payroll and audit.
Disclaimer
This article is general information based on Kenyan tax law and KRA guidance as at 23 October 2026. It is not tax, legal or financial advice, and rates, thresholds and deadlines change, often through the annual Finance Act. Confirm the current position with KRA or speak to FNJ & Associates before acting. FNJ & Associates accepts no liability for decisions made on the basis of this article.