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This guide is general information about Kenyan income tax for people who live in Kenya and work remotely for employers or clients abroad. It isn't tax advice. Rules change with each Finance Act, so check the KRA pages linked at the end, and talk to a registered tax adviser about your own situation.
We quote KRA's own pages and the Income Tax Act as KRA publishes it. Where something depends on your details, we say so.
Does Kenya tax pay from abroad?
Usually, yes, if you're resident in Kenya. Under the Income Tax Act (Cap. 470), an individual is resident if:
- you have a permanent home in Kenya and were present in Kenya at any time in the year, or
- you have no permanent home here but spent 183 days or more in Kenya in the year, or
- you were present in the year and in each of the two years before, for an average of more than 122 days a year.
Section 3 of the Act charges tax on income that accrued in or was derived from Kenya. Section 5 then says that pay to a resident for employment or services rendered "in Kenya or outside Kenya" is treated as derived from Kenya. For business income, section 4 says that when a resident runs a business partly inside and partly outside Kenya, the whole profit is treated as derived from Kenya.
In plain terms: if you live in Kenya and work from here for a company in London or New York, expect the income to be taxable in Kenya, whether you're an employee or a contractor. KRA's filing guide for the 2025 year tells people to declare freelance, consultancy and online work alongside any employment income.
Get your KRA PIN
You need a KRA PIN to file. You register on iTax. KRA lists what residents need:
- your national ID or alien ID card details
- your employer's PIN, if you're employed
- your business registration certificate details, if you run a registered business
KRA says every person with a PIN and an income tax obligation must file a return each year, even with no income. That's a nil return. So once you have a PIN, put 30 June in your calendar every year.
When no PAYE is deducted
A Kenyan employer deducts PAYE from your salary every month. A foreign company with no Kenyan payroll usually doesn't. An employer of record that runs payroll for you in Kenya normally does. If nothing is deducted, the tax still falls due, and you have to pay it yourself.
That's where instalment tax comes in. KRA says individuals pay instalment tax when their tax liability that isn't covered by PAYE is over KES 40,000 for the year. You pay 25% of the expected tax on the 20th day of the 4th, 6th, 9th and 12th months of the year of income. For most individuals the year of income is the calendar year, so the dates are 20 April, 20 June, 20 September and 20 December.
KRA also says people who pay Turnover Tax don't pay instalment tax. If you're not sure which regime fits you, ask KRA or an adviser before your first instalment date, not after it.
Rates and personal relief
KRA lists these annual bands for individual income tax, in effect from 1 July 2023:
| Taxable income (KES a year) | Rate |
|---|---|
| First 288,000 | 10% |
| Next 100,000 | 25% |
| Next 5,612,000 | 30% |
| Next 3,600,000 | 32.5% |
| Above 9,600,000 | 35% |
Every resident individual gets personal relief of KES 28,800 a year, which is KES 2,400 a month. Non-residents don't get it. Check KRA's page for the current figures before you calculate, because a Finance Act can change them.
Filing your annual return
- Window. Returns are filed on iTax from 1 January to 30 June of the following year. The 2026 return, for income from 1 January to 31 December 2026, is due by 30 June 2027.
- Which return. If you had employment income only, KRA's guide points you to the return based on your P9. If you also had freelance, consultancy or online income, you declare it together with your employment income.
- Penalties. Late filing costs the higher of 5% of the tax due or KES 2,000. Late payment costs 5% of the tax due plus interest of 1% a month on the unpaid tax. KRA's notice for the 2025 returns said people who missed the 30 June 2026 deadline would face default assessments under the Tax Procedures Act.
- eTIMS. KRA says that from the 2026 year of income, declared income and expenses must be backed by electronic tax invoices from eTIMS or TIMS. Ask KRA or your adviser how this applies to payments from clients abroad before you file for 2026.
Keep records all year: contracts, invoices, payment confirmations, bank statements, and receipts for business costs such as internet, power backup and equipment.
Tax paid in another country
Sometimes a client or employer abroad withholds tax before paying you. The Income Tax Act has two relief routes. Section 39 lets a Kenyan citizen who paid tax in another country, on employment income from that country, claim a credit against the Kenyan tax on the same income. Section 41 gives effect to double taxation agreements Kenya has signed with other countries.
Whether either applies depends on the country, the type of income and the paperwork you hold. Keep any certificate or statement that shows tax withheld abroad, and get advice before you claim.
When to see a registered tax adviser
Plenty of people file simple returns on their own. Get help if any of these apply:
- You have several foreign clients, or a mix of salary and contract income.
- Tax was withheld abroad.
- You moved into or out of Kenya during the year.
- You want to deduct business costs, or you've registered a business.
- You've had a KRA assessment, penalty or demand.
Related reading: getting paid from abroad, contractor or employee, and remote jobs open to people in Kenya.
