Calculate withholding tax (WHT) on payments to residents and non-residents in Kenya. Covers dividends, interest, royalties, management fees, and rent.
How Is Withholding Tax Calculated in Kenya?
Withholding tax (WHT) deducts a fixed percentage of a gross payment before the payer releases the rest to the payee. KRA sets the percentage by two factors together: the type of payment — dividends, interest, royalties, professional fees, management fees, or rent — and the residency status of the person or company receiving it. The payer withholds the tax at source and remits it directly to KRA, so the amount that reaches the payee is always the gross payment minus WHT.
What Are the Current WHT Rates by Payment Type?
Six payment categories carry distinct resident and non-resident rates. Dividends attract 5% for residents and 10% for non-residents. Interest is 15% regardless of residency. Royalties attract 5% for residents and 20% for non-residents. Professional, consultancy, and management or training fees each attract 5% for residents and 20% for non-residents. Rent on immovable property attracts 10% for residents and 30% for non-residents.
Does Residency Status Change the WHT Rate?
Yes, for every payment type except interest. A non-resident rate is consistently higher than the matching resident rate — double for dividends, quadruple for royalties, professional fees, and management fees, and triple for rent — because non-resident WHT is a final tax under Kenya's tax treaties, collected once at source since KRA has no further reach over income earned abroad. Select the recipient's actual residency status, not the payer's, since the rate always follows the person receiving the payment.
Who Deducts and Remits Withholding Tax?
The payer — the company or person making the payment — deducts WHT before disbursing funds and remits it to KRA by the 20th of the following month. For resident recipients, WHT on most payment types is an advance credit against the recipient's final income tax bill, not a final tax; for non-residents, it is typically the final tax on that income, since a non-resident usually files no further Kenyan return on it. Confirm treatment against a specific double taxation treaty where one applies.
How Do I Use the Withholding Tax Calculator?
Select the payment type and the recipient's residency status, then enter the gross amount being paid. The calculator looks up the matching KRA rate, multiplies it by the gross amount to show the WHT deducted, and subtracts that from the gross amount to show the net amount the recipient actually receives.
Verify with KRA: This calculator applies the WHT rates published in KRA's Withholding Tax guide under the Income Tax Act. Rates can change with each Finance Act and some payment types carry treaty-specific exceptions, so confirm the exact rate for your transaction against KRA's official Withholding Tax guide before relying on it for filing or remittance.
What is the withholding tax rate on dividends in Kenya?
Dividends paid to a resident attract 5% withholding tax; dividends paid to a non-resident attract 10%. Both rates are deducted at source before the dividend is paid out.
What is the withholding tax rate on rent in Kenya?
Rent paid to a resident landlord for immovable property attracts 10% withholding tax; rent paid to a non-resident landlord attracts 30%.
Is withholding tax a final tax in Kenya?
For residents, WHT on most payment types is an advance credit against the recipient's final income tax bill. For non-residents, WHT is typically the final tax on that income, since a non-resident usually files no further Kenyan return on it.