Business Kenya

How To Get a Tax Holiday in Kenya

Export Processing Zone (EPZ) businesses qualify for a 10 year tax holiday

The EPZ's also enjoy a reduced rate of corporation tax of 25% for the next ten years, zero rating for VAT purposes, exemption from withholding tax on certain payment to non-residents, certain reliefs from exchange control.

If your business is registered here and it has a branch overseas, you will be required to pay tax in Kenya regardless of whether you are paying abroad.

Here are other taxes that you may be subjected to;

Dividends

Tax is levied at flat rate of 10%. But if the receiving company owns more than 12.5% of the voting power of the subsidiary concerned, the dividends received from the subsidiary are tax free.

Withholding Tax

The main withholding tax rates for residents are: 15% on commissions paid by insurance companies to agents, 10% on interest, except when this is paid to banks and financial institutions, 10% on dividends, 5% on sale of certain farm produce.

Value Added Tax (VAT)

VAT was introduced in 1990. It is charged on: the manufacture and supply of taxable goods, the import of taxable goods or services, the supply of taxable services, and dealings in certain designated goods.

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