Expatriate tax ebook - Kenya

Facts and figures

Pre arrival procedures
Employment visas
Tax year
Tax returns and compliance
Income tax rates
Sample income tax calculation

Pre arrival procedures
The employers of non Kenyan nationals are usually required to apply for a Work Permit (WP) prior to the employee taking up employment in Kenya. It is therefore important that the expatriate's employment contract is put in place and work permit application is processed by Department of Immigration in Kenya, in due time.

Employment visas

• Work permits for highly  skilled employees fall under a separate class
• Spouses require independent work permits if also in employment
• If not in employment, they require a ‘dependant’s pass’
• Work permits are normally issued for two years
• Generally, work permits are not easy to obtain and have conditions attached, therefore, employers must complete all formalities well before employment is envisaged
• Work permits for nationals of  member  countries of  the East
• African Community will shortly not be required for cross border work within the EAC

  Tax year
  The Kenyan tax year runs from 1st January to 31st December.

  Tax returns and compliance
  Individuals who are non-residents of Kenya must file their tax return before end of June.

  Payment of Tax

  Payroll tax namely PAYE, NSSF and NHIF are deducted monthly from the salary. These are deducted at source; and are remitted by the employer to the tax authorities.

  Income tax rates
  Please refer to the Quick Tax Guide. Non-residents are charged tax (PAYE) at 30%

  
  

  Sample income tax calculation

  Employment Income
  Basic Pay	Shs. 50,000
  Add: Car Benefit	Shs.   2,000
  Add: Mobile Benefit	Shs.   1,000
  Total Earned Income	Shs. 53,000
  Less : NSSF (Employee’s contribution)	Shs.    (200)
  Chargeable Income	Shs. 52,800
  PAYE:
  On income up to Shs. 38,893	Shs.   6,761
  Shs. (52,800 – 38,893) x 30%	Shs.   4,172
  	Shs. 10,933
  Less: Personal Relief	Shs.  (1,162)
  PAYE	Shs.   9,771
  NSSF (Employer’s contribution)	Shs.    200
  NHIF	Shs.    320
  Net Pay	Shs. 39,709

  
  Information about Kenya:

• introduction
• facts and figures
• basis of taxation
• what taxes?
• tax planning opportunities

Last updated 14 June 2011

This information has been provided by Grant Thornton Kenya, a member firm within Grant Thornton International Ltd and is for informational purposes only. Neither Grant Thornton Kenya nor Grant Thornton International Ltd can guarantee the accuracy, timeliness or completeness of the data contained herein. As such, you should not act on the information without first seeking professional tax advice.
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