Income tax
Tax in Kenya is governed by the Kenya Revenue Authority, and all Kenyan residents are required to pay tax on all income earned, including bonuses, overtime, commissions, etc. You are considered a resident for tax purposes if you have resided in the country for 183 days or more out of the past fiscal year.
Income tax is calculated based total income from all employment or business, and ranges from 10-30% of your income amount, depending on which tax bracket you fall into. It is important to check if your home country has a double taxation agreement with Kenya, as otherwise, you may be eligible to pay tax to both Kenya and your home country.
Most employers use the PAYE, or Pay as you Earn, a method of filing tax, in which taxes and social security payments are automatically withdrawn from your salary. If your employer does not offer this, you will need to file tax yearly or quarterly. Whether your employer uses PAYE or not, it is still recommended to use a Kenyan accountant to file tax returns each year, especially if you are eligible for any tax treaties with your home country.
If you earn under a certain amount (varies yearly), you may be exempt from paying income tax.
If you own property and earn income from renting it out, your income earned will also count towards the total amount you pay in income tax. This is known as a residential rental income tax.
Good to know: The Kenyan financial year runs from 1 July- 30 June.
