Asked about Kenyan income tax for self-employed individuals.
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This Guide is general tax/accounting reference material for AI-assisted workflows. It has not been reviewed for your personal facts, documents, elections, deadlines, residency, filing status, or local procedures. Do not rely on it to file, pay, amend, or take a tax position without review by a qualified professional in the relevant jurisdiction.
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Progressive rate — Band 1 (KES 0–288,000)
10%Income Tax Act, Chapter 470, Third Schedule
Progressive rate — Band 2 (KES 288,001–388,000)
25%Income Tax Act, Chapter 470, Third Schedule
Progressive rate — Band 3 (KES 388,001–6,000,000)
30%Income Tax Act, Chapter 470, Third Schedule
Progressive rate — Band 4 (KES 6,000,001–9,600,000)
32.5%Income Tax Act, Chapter 470, Third Schedule
Progressive rate — Band 5 (KES 9,600,001+)
35%Income Tax Act, Chapter 470, Third Schedule
Band 1 upper threshold
KES 288,000Income Tax Act, Chapter 470, Third Schedule
Band 2 upper threshold
KES 388,000Income Tax Act, Chapter 470, Third Schedule
Band 3 upper threshold
KES 6,000,000Income Tax Act, Chapter 470, Third Schedule
Band 4 upper threshold
KES 9,600,000Income Tax Act, Chapter 470, Third Schedule
Non-resident flat rate
30%Income Tax Act, Chapter 470, Third Schedule
Personal relief (annual credit against tax)
KES 28,800/yearIncome Tax Act, Chapter 470
Insurance relief rate (life, health, education premiums)
15% of qualifying premiumsIncome Tax Act, Chapter 470, s31
Insurance relief annual cap
KES 60,000/yearIncome Tax Act, Chapter 470, s31
Annual self-assessment return filing deadline
30 June of the following yearIncome Tax Act, Chapter 470; Tax Procedures Act 2015
Instalment tax payment — frequency
Quarterly: 20th of the 4th, 6th, 9th, and 12th months of the accounting yearIncome Tax Act, Chapter 470, s12
Instalment tax — each instalment percentage
25% of estimated annual tax per quarterIncome Tax Act, Chapter 470, s12
Instalment tax — exemption threshold (prior year tax)
KES 40,000 (not required if prior year tax < KES 40,000)Income Tax Act, Chapter 470, s12
Instalment tax — under-estimation penalty
20%Income Tax Act, Chapter 470, s12
Turnover tax (TOT) rate
1.5% on gross turnoverIncome Tax Act, Chapter 470, s12C
Turnover tax — lower threshold
KES 1,000,000 gross turnoverIncome Tax Act, Chapter 470, s12C
Turnover tax — upper threshold
KES 25,000,000 gross turnoverIncome Tax Act, Chapter 470, s12C
Turnover tax — filing frequency
MonthlyIncome Tax Act, Chapter 470, s12C
Presumptive tax — annual fixed amount
KES 15,000/yearIncome Tax Act, Chapter 470, s12D
Presumptive tax — turnover ceiling
KES 1,000,000Income Tax Act, Chapter 470, s12D
Wear-and-tear rate — heavy/self-propelling machinery
37.5% (reducing balance)Income Tax Act, Chapter 470, Second Schedule
Wear-and-tear rate — computer/IT equipment
30% (reducing balance)Income Tax Act, Chapter 470, Second Schedule
Wear-and-tear rate — motor vehicles
25% (reducing balance)Income Tax Act, Chapter 470, Second Schedule
Wear-and-tear rate — furniture and fittings
12.5% (reducing balance)Income Tax Act, Chapter 470, Second Schedule
Wear-and-tear rate — farm machinery
100% (reducing balance)Income Tax Act, Chapter 470, Second Schedule
Withholding tax on interest income
15%Income Tax Act, Chapter 470
Withholding tax on professional fees received
5% (credit against final tax)Income Tax Act, Chapter 470
Capital gains tax rate (out of scope, reference only)
15%Income Tax Act, Chapter 470
Corporate income tax rate (out of scope, reference only)
30%Income Tax Act, Chapter 470
Non-resident consulting WHT rate (edge case EC8)
20% (or treaty rate)Income Tax Act, Chapter 470
Record-keeping retention period
5 yearsTax Procedures Act 2015, s23
Record-keeping language
English or SwahiliTax Procedures Act 2015, s23
Record-keeping medium
Paper or electronicTax Procedures Act 2015, s23
Filing portal
iTax (itax.kra.go.ke)Kenya Revenue Authority (KRA)
Quick reference field table
| Field | Value |
|---|---|
| Country | Kenya |
| Tax type | Income tax on business income (self-assessment) |
| Primary legislation | Income Tax Act, Chapter 470 |
| Supporting legislation | Tax Procedures Act 2015; Finance Act 2023; Finance Act 2024 |
| Tax authority | KRA (Kenya Revenue Authority) |
| Filing portal | iTax (itax.kra.go.ke) |
| Currency | KES only |
| Return form | Self-assessment return |
| Filing deadline | 30 June of the following year |
| Instalment tax | Quarterly (20th of 4th, 6th, 9th, 12th months) |
| Personal relief | KES 28,800/year (credit against tax) |
| Insurance relief | 15% of qualifying premiums, cap KES 60,000/year |
| Turnover tax | 1.5% on gross turnover KES 1M--25M (non-professional) |
| Presumptive tax | KES 15,000/year (turnover below KES 1M) |
| Contributor | Open Accountants Community |
| Validated by | Pending -- requires Kenyan CPA or registered tax agent sign-off |
| Validation date | Pending |
Progressive tax table (resident, annual)
| Taxable income (KES) | Rate |
|---|---|
| 0--288,000 | 10% |
| 288,001--388,000 | 25% |
| 388,001--6,000,000 | 30% |
| 6,000,001--9,600,000 | 32.5% |
| 9,600,001+ | 35% |
Wear-and-tear rates (reducing balance)
| Asset | Rate |
|---|---|
| Heavy/self-propelling machinery | 37.5% |
| Computer/IT equipment | 30% |
| Motor vehicles | 25% |
| Furniture and fittings | 12.5% |
| Farm machinery | 100% |
Conservative defaults
| Ambiguity | Default |
|---|---|
| Unknown residency | STOP -- non-residents pay flat 30% |
| Unknown expense category | Not deductible |
| Unknown business-use proportion | 0% |
| Unknown whether turnover tax is elected | Normal tax |
Read this whole section before classifying anything.
Kenyan banks (fees and interest)
| Pattern | Treatment | Notes |
|---|---|---|
| EQUITY BANK | Bank charges: deductible | Monthly/transaction fees |
| KCB, KENYA COMMERCIAL BANK | Bank charges: deductible | Same |
| CO-OPERATIVE BANK, CO-OP | Bank charges: deductible | Same |
| NCBA | Bank charges: deductible | Same |
| STANDARD CHARTERED KENYA | Bank charges: deductible | Same |
| ABSA KENYA (formerly Barclays) | Bank charges: deductible | Same |
| I&M BANK, DTB | Bank charges: deductible | Same |
| REVOLUT, WISE (fees) | Deductible | Fintech fees |
| INTEREST (credit) | Taxable income | Subject to WHT at source (15%) |
| INTEREST (debit) | Deductible if business loan | Personal: NOT deductible |
| LOAN (principal) | EXCLUDE | Principal movement |
M-Pesa and mobile money
| Pattern | Treatment | Notes |
|---|---|---|
| MPESA, M-PESA, SAFARICOM | Transaction fees: deductible | Business M-Pesa charges |
| MPESA PAYBILL, TILL NO | Revenue if incoming; deductible if outgoing business payment | Verify nature |
| MPESA FLOAT, B2C, C2B | EXCLUDE if internal movement | Business float management |
| AIRTEL MONEY | Same as M-Pesa | Alternative mobile money |
Kenyan government and statutory bodies
| Pattern | Treatment | Notes |
|---|---|---|
| KRA, KENYA REVENUE AUTHORITY | EXCLUDE | Tax payment |
| NSSF, NATIONAL SOCIAL SECURITY | Deductible (up to statutory limit) | Provident fund contribution |
| SHIF, SOCIAL HEALTH INSURANCE | NOT deductible for income tax | Separate health levy |
| NHIF (legacy) | NOT deductible | Replaced by SHIF |
| COUNTY GOVERNMENT, NAIROBI COUNTY | Deductible if business licence/permit | Business licence fees |
Kenyan utilities and telecoms
| Pattern | Treatment | Notes |
|---|---|---|
| KENYA POWER, KPLC | Deductible if business premises | Electricity; apportion if home |
| NAIROBI WATER, ELDOWAS | Deductible if business premises | Water |
| SAFARICOM, AIRTEL, TELKOM KENYA | Deductible: business phone/internet | Mixed: apportion |
| ZUKU, FAIBA | Deductible: business internet | Mixed: apportion |
SaaS and software -- international
| Pattern | Treatment | Notes |
|---|---|---|
| GOOGLE, MICROSOFT, ADOBE, META | Deductible expense | International SaaS |
| GITHUB, OPENAI, ANTHROPIC | Deductible expense | Non-EU |
| SLACK, ZOOM, ATLASSIAN | Deductible expense | Check entity |
Professional services (Kenya)
| Pattern | Treatment | Notes |
|---|---|---|
| ACCOUNTANT, CPA, AUDIT FIRM | Deductible | Accounting fees |
| ADVOCATE, LAW FIRM | Deductible if business | Legal fees |
| TAX AGENT | Deductible | Tax advisory |
Transport and travel
| Pattern | Treatment | Notes |
|---|---|---|
| KENYA AIRWAYS, JAMBOJET | Deductible if business travel | Flights |
| UBER, BOLT, LITTLE CAB | Deductible if business | Ride services |
| TOTAL, SHELL, RUBIS, VIVO ENERGY | Deductible: business vehicle portion | Fuel |
| SGR (Madaraka Express) | Deductible if business | Train |
Insurance
| Pattern | Treatment | Notes |
|---|---|---|
| JUBILEE, BRITAM, CIC, UAP, APA | Deductible if business insurance | Personal life/health: insurance RELIEF (not deduction) |
| INSURANCE PREMIUM (life/health/education) | Insurance relief: 15% of premiums, cap KES 60,000 | Credit against tax |
Food and entertainment
| Pattern | Treatment | Notes |
|---|---|---|
| NAIVAS, CARREFOUR KE, QUICKMART | Default: NOT deductible | Personal provisioning |
| RESTAURANT | Deductible only if wholly and exclusively business | Must prove |
Internal transfers and exclusions
| Pattern | Treatment | Notes |
|---|---|---|
| OWN TRANSFER, INTERNAL | EXCLUDE | Internal movement |
| MPESA TO BANK, BANK TO MPESA | EXCLUDE | Own account transfer |
| DRAWINGS, PERSONAL | EXCLUDE | Owner drawings |
Input: Resident, revenue KES 3,000,000, expenses KES 1,200,000, insurance premiums KES 100,000, instalment tax KES 150,000. Computation: Taxable = KES 1,800,000. Tax = 28,800 + 25,000 + 423,600 = KES 477,400. Less personal relief 28,800. Less insurance relief min(15,000, 60,000) = 15,000. Net = KES 433,600. Less instalment KES 150,000. Due = KES 283,600.
Input: Taxable income KES 200,000. Computation: Tax = 10% x 200,000 = KES 20,000. Less relief KES 28,800. Payable = KES 0.
Input: Non-professional trader, turnover KES 8,000,000. Computation: TOT = 1.5% x KES 8,000,000 = KES 120,000/year.
Input: Small trader, turnover KES 500,000, expenses KES 350,000. Computation: Normal: profit KES 150,000. Tax = 15,000 - 28,800 relief = KES 0. Presumptive: KES 15,000. Normal is better.
Why: Depends on expense level and qualification. Default: Present both. Question: "What are your total expenses? Professional services?"
Why: Normal may be cheaper if expenses are high. Default: Compute both. Question: "Total documented expenses?"
Why: Unknown split. Default: 0%. Question: "Do you maintain a logbook?"
Why: Must be dedicated space. Default: Not deductible. Question: "Dedicated room for business?"
Why: Complex rules. Default: Flag for reviewer. Question: "Do you own business premises?"
Columns: Date, Counterparty, Description, Amount (KES), Category (Revenue/Expense/Capital/Insurance/EXCLUDE), Deductible amount, Default?, Question, Notes.
Progressive brackets. Reliefs. Instalment tax offset. WHT credits.
CSV formats. Equity Bank exports CSV with DD/MM/YYYY. KCB uses various formats. Co-op Bank uses semicolons. Common columns: Date, Description/Narration, Debit, Credit, Balance.
M-Pesa integration. Many transactions flow through M-Pesa. M-Pesa statements are separate from bank statements. Request both. M-Pesa shows: transaction ID, type (paybill/till/send money), recipient, amount.
Kenyan-specific patterns. "PAYBILL" = payment to business. "TILL" = payment at point of sale. "B2C" = business to customer. "C2B" = customer to business. "FULIZA" = overdraft (loan -- exclude principal). "KCB MPESA" = integrated mobile banking.
WHT deductions. Professional fees received may have 5% withheld. Gross up the income and claim WHT credit.
Foreign currency. Convert to KES at CBK (Central Bank of Kenya) rate on transaction date.
Inference: Kenyan bank + KRA PIN. Fallback: "Are you a Kenyan tax resident?"
Inference: From counterparty mix. Fallback: "What is your business activity?"
Inference: Sum of credits. Fallback: "What is your approximate annual turnover? (Determines TOT/presumptive eligibility.)"
Inference: If TOT monthly payments visible. Fallback: "Are you on turnover tax, presumptive tax, or normal self-assessment?"
Inference: Monthly insurance debits. Fallback: "Do you pay life, health, or education insurance premiums?"
Inference: Quarterly KRA payments. Fallback: "What instalment tax amounts have you paid?"
Inference: Not inferable from bank statement. Fallback: "Do you have WHT certificates from clients who withheld tax?"
Test 1 -- Mid-range. KES 3M revenue, KES 1.2M expenses, KES 100K insurance, KES 150K instalment. Net tax KES 283,600. Test 2 -- Below relief. KES 200K taxable. Tax KES 0 (below relief). Test 3 -- Turnover tax. KES 8M turnover. TOT KES 120,000. Test 4 -- Insurance cap. KES 600K premiums. Relief = KES 60,000. Test 5 -- High earner. KES 12M taxable. Tax KES 3,718,600. Test 6 -- Presumptive vs normal. KES 500K turnover, KES 350K expenses. Normal = KES 0; presumptive = KES 15,000.
EC1 -- Personal relief as deduction. INCORRECT -- it's a credit against tax. EC2 -- Insurance relief cap. KES 60,000 maximum. EC3 -- TOT for professionals. NOT eligible. EC4 -- Presumptive vs normal. Compare both. EC5 -- WHT not credited. Must include as credit. EC6 -- SHIF deductibility. NOT deductible. EC7 -- Capital gain on business asset. ESCALATE. EC8 -- Non-resident consulting. 20% WHT (or treaty rate). ESCALATE.
This skill and its outputs are provided for informational and computational purposes only and do not constitute tax, legal, or financial advice. Open Accountants and its contributors accept no liability for any errors, omissions, or outcomes arising from the use of this skill. All outputs must be reviewed and signed off by a qualified professional (such as a CPA(K), registered tax agent, or equivalent licensed practitioner in Kenya) before filing or acting upon.
The most up-to-date, verified version of this skill is maintained at openaccountants.com.
Other Kenya computations in the OpenAccountants Tax Library.
Rendered from the facts database. General reference only — confirm with a qualified professional before acting.
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