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LAWS OF KENYA
INCOME TAX ACT
CAP. 470
- Published in Kenya Gazette Vol. LXXV—No. 55 on 28 December 1973
- Assented to on 21 December 1973
- Commenced on 1 January 1974
- [Amended by Finance Act (No. 2) Act, 1975 (Act No. 13 of 1975) on 1 January 1975]
- [Amended by Finance Act, 1975 (Act No. 2 of 1975) on 7 March 1975]
- [Amended by Income Tax (Amendment) Act, 1976 (Act No. 7 of 1976) on 13 June 1975]
- [Amended by Finance Act, 1976 (Act No. 11 of 1976) on 18 June 1976]
- [Amended by Finance Act, 1977 (Act No. 12 of 1977) on 17 June 1977]
- [Amended by Statute Law (Miscellaneous Amendments) Act, 1977 (Act No. 16 of 1977) on 28 October 1977]
- [Amended by Finance Act, 1978 (Act No. 8 of 1978) on 1 January 1978]
- [Amended by Statute Law (Miscellaneous Amendments) Act, 1978 (Act No. 13 of 1978) on 10 November 1978]
- [Amended by Finance Act, 1979 (Act No. 13 of 1979) on 8 June 1979]
- [Amended by Finance Act, 1981 (Act No. 6 of 1981) on 3 September 1979]
- [Amended by Statute Law (Miscellaneous)(Amendments)(No. 2) Act, 1979 (Act No. 18 of 1979) on 7 September 1979]
- [Amended by Finance Act, 1979 (Act No. 13 of 1979) on 1 January 1980]
- [Amended by Finance Act (No. 2) Act, 1980 (Act No. 12 of 1980) on 1 January 1980]
- [Amended by Finance Act, 1980 (Act No. 10 of 1980) on 1 January 1981]
- [Amended by Finance Act, 1981 (Act No. 6 of 1981) on 1 January 1981]
- [Amended by Finance Act, 1982 (Act No. 1 of 1982) on 1 January 1981]
- [Amended by Finance Act, 1981 (Act No. 6 of 1981) on 17 June 1981]
- [Amended by Finance Act, 1983 (Act No. 8 of 1983) on 24 June 1981]
- [Amended by Finance Act, 1982 (Act No. 1 of 1982) on 18 December 1981]
- [Amended by Finance Act, 1981 (Act No. 6 of 1981) on 1 January 1982]
- [Amended by Finance Act (No. 3),1982 (Act No. 14 of 1982) on 1 January 1982]
- [Amended by Finance Act, 1983 (Act No. 8 of 1983) on 1 January 1982]
- [Amended by Finance Act, 1988 (Act No. 10 of 1988) on 1 January 1982]
- [Amended by Finance Act (No. 3),1982 (Act No. 14 of 1982) on 18 June 1982]
- [Amended by Income Tax (Amendment) Act, 1984 (Act No. 18 of 1984) on 1 January 1984]
- [Amended by Finance Act, 1984 (Act No. 13 of 1984) on 15 June 1984]
- [Amended by Income Tax (Amendment) Act, 1984 (Act No. 18 of 1984) on 28 December 1984]
- [Amended by Finance Act, 1984 (Act No. 13 of 1984) on 1 January 1985]
- [Amended by Finance Act, 1985 (Act No. 8 of 1985) on 1 January 1985]
- [Amended by Finance Act, 1985 (Act No. 8 of 1985) on 14 June 1985]
- [Amended by Finance Act, 1985 (Act No. 8 of 1985) on 1 January 1986]
- [Amended by Finance Act, 1986 (Act No. 10 of 1986) on 13 June 1986]
- [Amended by Finance (No. 2) Act, 1989 (Act No. 8 of 1989) on 13 June 1986]
- [Amended by Finance Act, 1986 (Act No. 10 of 1986) on 1 January 1987]
- [Amended by Finance Act, 1987 (Act No. 10 of 1987) on 1 January 1987]
- [Amended by Finance Act, 1992 (Act No. 9 of 1992) on 1 January 1987]
- [Amended by Finance Act, 1992 (Act No. 9 of 1992) on 1 January 1987]
- [Amended by Finance Act, 1987 (Act No. 10 of 1987) on 12 June 1987]
- [Amended by Finance Act, 1987 (Act No. 10 of 1987) on 1 January 1988]
- [Amended by Finance Act, 1992 (Act No. 9 of 1992) on 1 January 1988]
- [Amended by Finance Act, 1988 (Act No. 10 of 1988) on 17 June 1988]
- [Amended by Finance Act, 1988 (Act No. 10 of 1988) on 1 January 1989]
- [Amended by Finance (No. 2) Act, 1989 (Act No. 8 of 1989) on 1 January 1989]
- [Amended by Finance (No. 2) Act, 1990 (Act No. 10 of 1990) on 1 January 1989]
- [Amended by Finance (No. 2) Act, 1989 (Act No. 8 of 1989) on 16 June 1989]
- [Amended by Finance Act, 1987 (Act No. 10 of 1987) on 1 July 1989]
- [Amended by Finance (No. 2) Act, 1989 (Act No. 8 of 1989) on 1 July 1989]
- [Amended by Cotton Act (Act No. 3 of 1988) on 1 September 1989]
- [Amended by Banking Act (Cap. 488) on 1 November 1989]
- [Amended by Statute Law (Miscellaneous Amendments) Act, 1989 (Act No. 20 of 1989) on 29 December 1989]
- [Amended by Finance (No. 2) Act, 1990 (Act No. 10 of 1990) on 1 January 1990]
- [Amended by Statute Law (Miscellaneous Amendments) Act.(No.2), 1990 (Act No. 21 of 1990) on 18 January 1990]
- [Amended by Finance (No. 2) Act, 1990 (Act No. 10 of 1990) on 7 June 1990]
- [Amended by Statute Law (Repealed and Miscellaneous Amendments) Act, 1990 (Act No. 7 of 1990) on 22 June 1990]
- [Amended by Finance (No. 2) Act, 1990 (Act No. 10 of 1990) on 1 January 1991]
- [Amended by Finance (No.2) Act,1991 (Act No. 8 of 1991) on 1 January 1991]
- [Amended by Finance Act, 1992 (Act No. 9 of 1992) on 1 January 1991]
- [Amended by Finance Act, 1993 (Act No. 4 of 1993) on 1 January 1991]
- [Amended by Finance Act, 1994 (Act No. 6 of 1994) on 1 January 1991]
- [Amended by Finance (No.2) Act,1991 (Act No. 8 of 1991) on 13 June 1991]
- [Amended by Finance Act, 1994 (Act No. 6 of 1994) on 1 January 1992]
- [Amended by Finance Act, 2004 (Act No. 4 of 2004) on 1 January 1992]
- [Amended by Finance Act, 1992 (Act No. 9 of 1992) on 5 June 1992]
- [Amended by Finance Act, 1992 (Act No. 9 of 1992) on 1 January 1993]
- [Amended by Finance Act, 1993 (Act No. 4 of 1993) on 1 January 1993]
- [Amended by Finance Act, 1994 (Act No. 6 of 1994) on 1 January 1993]
- [Amended by Finance Act, 1993 (Act No. 4 of 1993) on 11 June 1993]
- [Amended by Finance Act, 1993 (Act No. 4 of 1993) on 1 July 1993]
- [Amended by Finance Act, 1992 (Act No. 9 of 1992) on 1 January 1994]
- [Amended by Finance Act, 1993 (Act No. 4 of 1993) on 1 January 1994]
- [Amended by Finance Act, 1994 (Act No. 6 of 1994) on 1 January 1994]
- [Amended by Finance Act, 1994 (Act No. 6 of 1994) on 17 June 1994]
- [Amended by Finance Act, 1994 (Act No. 6 of 1994) on 1 July 1994]
- [Amended by Finance Act, 1994 (Act No. 6 of 1994) on 1 October 1994]
- [Amended by Finance Act, 1994 (Act No. 6 of 1994) on 1 January 1995]
- [Amended by Finance Act, 1995 (Act No. 13 of 1995) on 1 January 1995]
- [Amended by Finance Act, 1995 (Act No. 13 of 1995) on 16 June 1995]
- [Amended by Finance Act, 1995 (Act No. 13 of 1995) on 1 January 1996]
- [Amended by Finance Act, 1996 (Act No. 8 of 1996) on 18 June 1996]
- [Amended by Finance Act, 2000 (Act No. 9 of 2000) on 11 June 1998]
- [Amended by Finance Act, 1999 (Act No. 4 of 1999) on 10 June 1999]
- [Amended by Finance Act, 1999 (Act No. 4 of 1999) on 1 January 2000]
- [Amended by Finance Act, 2001 (Act No. 6 of 2001) on 14 June 2001]
- [Amended by Finance Act, 2002 (Act No. 7 of 2002) on 13 June 2002]
- [Amended by Finance Act, 2003 (Act No. 15 of 2003) on 12 June 2003]
- [Amended by Finance Act, 2003 (Act No. 15 of 2003) on 1 July 2003]
- [Amended by Finance Act, 2003 (Act No. 15 of 2003) on 1 January 2004]
- [Amended by Finance Act, 2004 (Act No. 4 of 2004) on 1 January 2004]
- [Amended by Finance Act, 2004 (Act No. 4 of 2004) on 10 June 2004]
- [Amended by Finance Act, 2004 (Act No. 4 of 2004) on 11 June 2004]
- [Amended by Finance Act, 2004 (Act No. 4 of 2004) on 1 July 2004]
- [Amended by Finance Act, 2004 (Act No. 4 of 2004) on 1 January 2005]
- [Amended by Finance Act, 2004 (Act No. 4 of 2004) on 7 January 2005]
- [Amended by Finance Act, 2005 (Act No. 6 of 2005) on 8 June 2005]
- [Amended by Finance Act, 2005 (Act No. 6 of 2005) on 9 June 2005]
- [Amended by Finance Act, 2005 (Act No. 6 of 2005) on 1 July 2005]
- [Amended by Finance Act, 2005 (Act No. 6 of 2005) on 1 January 2006]
- [Amended by Finance Act, 2006 (Act No. 10 of 2006) on 16 June 2006]
- [Amended by Finance Act, 2006 (Act No. 10 of 2006) on 1 July 2006]
- [Amended by Finance Act, 2006 (Act No. 10 of 2006) on 12 July 2006]
- [Amended by Finance Act, 2006 (Act No. 10 of 2006) on 9 November 2006]
- [Amended by Finance Act, 2006 (Act No. 10 of 2006) on 1 January 2007]
- [Amended by Finance Act, 2007 (Act No. 9 of 2007) on 15 June 2007]
- [Amended by Finance Act, 2007 (Act No. 9 of 2007) on 1 January 2008]
- [Amended by Finance Act, 2008 (Act No. 8 of 2008) on 13 June 2008]
- [Amended by Finance Act, 2008 (Act No. 8 of 2008) on 1 October 2008]
- [Amended by Finance Act, 2008 (Act No. 8 of 2008) on 1 January 2009]
- [Amended by Finance Act, 2009 (Act No. 8 of 2009) on 12 June 2009]
- [Amended by Finance Act, 2009 (Act No. 8 of 2009) on 1 January 2010]
- [Amended by Finance Act, 2010 (Act No. 10 of 2010) on 11 June 2010]
- [Amended by Finance Act, 2010 (Act No. 10 of 2010) on 1 January 2011]
- [Amended by Finance Act, 2012 (Act No. 4 of 2012) on 9 June 2011]
- [Amended by Finance Act, 2012 (Act No. 4 of 2012) on 1 January 2012]
- [Amended by Finance Act, 2012 (Act No. 57 of 2012) on 15 June 2012]
- [Amended by Finance Act, 2012 (Act No. 57 of 2012) on 1 January 2013]
- [Amended by Finance Act, 2012 (Act No. 57 of 2012) on 1 February 2013]
- [Amended by Finance Act, 2012 (Act No. 57 of 2012) on 1 July 2013]
- [Amended by Finance Act, 2013 (Act No. 38 of 2013) on 1 January 2014]
- [Amended by Finance Act, 2014 (Act No. 16 of 2014) on 13 June 2014]
- [Amended by Finance Act, 2014 (Act No. 16 of 2014) on 19 September 2014]
- [Amended by Finance Act, 2014 (Act No. 16 of 2014) on 3 October 2014]
- [Amended by Finance Act, 2014 (Act No. 16 of 2014) on 1 January 2015]
- [Amended by Tax Appeals Tribunal Act (Cap. 469A) on 1 April 2015]
- [Amended by Finance Act, 2015 (Act No. 14 of 2015) on 1 January 2016]
- [Amended by Tax Procedures Act (Cap. 469B) on 19 January 2016]
- [Amended by Finance Act, 2016 (Act No. 38 of 2016) on 9 June 2016]
- [Amended by Finance Act, 2016 (Act No. 38 of 2016) on 1 July 2016]
- [Amended by Finance Act, 2016 (Act No. 38 of 2016) on 1 January 2017]
- [Amended by Finance Act, 2017 (Act No. 15 of 2017) on 3 April 2017]
- [Amended by Statute Law (Miscellaneous Amendments) Act, 2017 (Act No. 11 of 2017) on 4 May 2017]
- [Amended by Finance Act, 2017 (Act No. 15 of 2017) on 1 January 2018]
- [Amended by Tax Laws (Amendment) Act, 2018 (Act No. 9 of 2018) on 1 July 2018]
- [Amended by Finance Act, 2018 (Act No. 10 of 2018) on 1 July 2018]
- [Amended by Finance Act, 2018 (Act No. 10 of 2018) on 1 January 2019]
- [Amended by Finance Act, 2019 (Act No. 23 of 2019) on 7 November 2019]
- [Amended by Business Laws (Amendment) Act, 2020 (Act No. 1 of 2020) on 18 March 2020]
- [Amended by Tax Laws (Amendment) Act, 2020 (Act No. 2 of 2020) on 25 April 2020]
- [Amended by Finance Act, 2020 (Act No. 8 of 2020) on 30 June 2020]
- [Amended by Tax Laws (Amendment)(No. 2) Act, 2020 (Act No. 22 of 2020) on 1 January 2021]
- [Amended by Finance Act, 2021 (Act No. 8 of 2021) on 1 July 2021]
- [Amended by Finance Act, 2021 (Act No. 8 of 2021) on 1 January 2022]
- [Amended by Finance Act, 2022 (Act No. 22 of 2022) on 1 July 2022]
- [Revised by 24th Annual Supplement (Legal Notice 221 of 2023) on 31 December 2022]
- [Amended by Finance Act, 2022 (Act No. 22 of 2022) on 1 January 2023]
- [Amended by Finance Act, 2023 (Act No. 4 of 2023) on 1 July 2023]
- [Amended by Finance Act, 2023 (Act No. 4 of 2023) on 1 September 2023]
- [Amended by Finance Act, 2023 (Act No. 4 of 2023) on 1 January 2024]
- [Amended by Affordable Housing Act (Act No. 2 of 2024) on 22 March 2024]
- [Amended by Tax Laws (Amendment) Act, 2024 (Act No. 12 of 2024) on 27 December 2024]
Part I – PRELIMINARY
1. Short title and commencement
This Act may be cited as the Income Tax Act, and shall, subject to the Sixth Schedule, come into operation on 1st January, 1974, and apply to assessments for the year of income 1974 and subsequent years of income.2. Interpretation
Part II – IMPOSITION OF INCOME TAX
3. Charge of tax
4. Income from businesses
For the purposes of section 3(2)(a)(i)–(a)where a business is carried on or exercised partly within and partly outside Kenya by a resident person, the whole of the gains or profits from such business shall be deemed to have accrued in or to have been derived from Kenya;(b)the gains or profits of a partner from a partnership shall be the sum of–(i)any remuneration payable to him by the partnership together with any interest on capital so payable, less any interest on capital payable by him to the partnership; and(ii)his share of the total income of the partnership, calculated after deducting the total of any remuneration and interest on capital payable to any partner by the partnership and after adding any interest on capital payable by any partner to the partnership,and where the partnership makes a loss, calculated in the manner set out in subparagraph (ii), his gains or profits shall be the excess, if any, of the amount set out in subparagraph (i) over his share of that loss;Provided that in computing the total income of a partnership, there shall be deducted the cost of medical expenses or medical insurance cover paid by the partnership for the benefit of any partner, subject to a limit of one million shillings per year;(c)any sum received under any insurance against loss of profits, or received by way of damages or compensation for loss of profits, shall be deemed to be gains or profits of the year of income in which it is received;(d)where in computing gains or profits for any year of income any expenditure or loss has been deducted, or a deduction in respect of any reserve or provision to meet any liability has been made, and in a later year of income the whole or part of such expenditure or loss is recovered, or the whole or part of that liability is released, or the retention in whole or in part of such reserve or provision has become unnecessary, then any sum so recovered or released or no longer required as a reserve or provision shall be deemed to be gains or profits of the year of income in which it is recovered or released or no longer required:Provided that if the person so chargeable with tax in respect of any such sum requests the Commissioner in writing to exercise his power under this proviso, the Commissioner may divide the sum into so many equal portions, not exceeding six, as he may consider fit, and one such portion shall be taken into account in computing the gains or profits of such person for the year of income in respect of which such sum is so deemed to be gains or profits and for each of the previous years of income corresponding to the number of portions;(e)where under the Second Schedule it is provided that a balancing charge shall be made, or a sum shall be treated as a trading receipt, for any year of income, the amount thereof shall be deemed to be gains or profits of that year of income;(f)in computing the gains or profits of a "licensee" "contractor" or "subcontractor" as defined in the Ninth Schedule, the provisions of that Schedule shall apply.[Act No. 18 of 1984, s. 2, Act No. 8 of 2009, s. 17, Act No. 4 of 2012, s. 10, Act No. 16 of 2016, s. 4.]4A. Income from businesses where foreign exchange loss or gain is realized
4B. Export processing zone enterprise
Where a business is carried on by an export processing zone enterprise, the provisions of the Eleventh Schedule shall apply.[Act No. 10 of 1990, s. 40.]5. Income from employment, etc.
6. Income from the use of property
6A. Imposition of residential rental Income Tax
7. Income from dividends
7A. Dividend distributed out of untaxed gains or profits
Where a dividend is distributed out of gains or profits on which no tax is paid, the company distributing the dividend shall be charged to tax in the year of income in which the dividends are distributed at the resident corporate rate of tax on the gains or profits from which such dividends are distributed:Provided that this section shall not apply to income which is exempt under this Act.[Act No. 10 of 2018, s. 4, Act No. 23 of 2019, s. 4.]7B. Repratiated income
8. Income from pensions, etc.
9. Income of certain non-resident persons deemed derived from Kenya
10. Income from management or professional fees, royalties, interest and rents
11. Trust income, etc., deemed income of trustee, beneficiary, etc.
12. Imposition of instalment tax
12A. Imposition of advance tax
12B. Imposition of fringe benefit Tax
12C. Turnover and presumptive tax
12D. Minimum tax
12E. Significant economic presence tax
12F. Digital asset tax
12G. Minimum top-up tax
Part III – EXEMPTION FROM TAX
13. Certain income exempt from tax, etc.
14. Interest on Government loans, etc., exempt from tax
Part IV – ASCERTAINMENT OF TOTAL INCOME
15. Deductions allowed
16. Deductions not allowed
17. Ascertainment of income of farmer in relation to stock
17A. Repealed
Repealed by Act No. 9 of 2000, s. 43.18. Ascertainment of gains or profits of business in relation to certain non-resident persons
18A. Ascertainment of gains and profits of business in a preferential tax regime
18B. Application of sections 18C, 18D, 18E and 18F
The provisions of sections, 18C, 18D, 18E, and 18F shall apply to returns for the year of income 2022 and subsequent years of income.[Act No. 22 of 2022, s. 11.]18C. Notification to the Commissioner
18D. Filing of country-by-country report, master file and local file
18E. Offences and penalties
A person who fails to comply with the provisions of sections 18C and 18D commits an offence and shall be subject to the penalties prescribed under the Tax Procedures Act (Cap. 469B).[Act No. 22 of 2022, s. 12.]18F. Definitions
For the purposes of sections 18C, 18D and 18E–"competent authority agreement" means an agreement between authorized representatives of jurisdictions which are parties to an international agreement that requires the exchange of country-by-country reports;"consolidated financial statements" means financial statements of a multinational enterprise group in which the assets, liabilities, income, expenses and cash flows of the ultimate parent entity and the constituent entities are presented as those of a single enterprise;"constituent entity” means–(a)any separate business unit of a multinational enterprise group that is included in the consolidated financial statements of the multinational enterprise group for financial reporting purposes, or which would be so included if equity interests in such business unit of a multinational enterprise group were traded on a public securities exchange;(b)any such business unit that is excluded from the multinational enterprise group’s consolidated financial statements solely on size or materiality grounds;(c)any permanent establishment of any separate business unit of the multinational enterprise group included in paragraphs (a) or (b) provided that the business unit prepares a separate financial statement for such permanent establishment for financial reporting, regulatory, tax reporting, or internal management control purposes;“a country-by-country report” means a report filed under section 18D(1) describing the financial activities of each constituent entity in all the jurisdictions where the group has taxable presence;"excluded multinational enterprise group” means, with respect to any financial year of the group, a group having total consolidated group revenue of less than the amount specified in section 18D(1);“group” means a collection of enterprises related through ownership or control such that it is either required to prepare consolidated financial statements for financial reporting purposes under applicable accounting principles or would be so required if equity interests in any of the enterprises were traded on a public securities exchange and includes a single enterprise with one or more foreign permanent establishments;“international agreement” means a bilateral or multilateral tax agreement to which Kenya is a party which provides for the exchange of tax information between Kenya and other jurisdictions;“local file” means a file under section 18D(7) containing material transactions of the local taxpayer;“master file” means a file under section 18D(6) containing standardized information relevant for all multinational enterprise group members;"multinational enterprise group” means a group that includes two or more enterprises which are resident in different jurisdictions including an enterprise that carries on business through a permanent establishment or through any other entity in another jurisdiction;“reporting financial year” means an annual accounting period with respect to which the ultimate parent entity of the multinational enterprise group prepares its financial statements;"surrogate parent entity” means one constituent entity of the multinational enterprise group appointed by such group to file the country-by-country report in that constituent entity’s jurisdiction of tax residence, on behalf of the group;“systemic failure” means failure to comply with the competent authority agreement for reasons other than those provided in the agreement;“ultimate parent entity” means an entity which–(a)is not controlled by another entity; and(b)owns or controls, directly or indirectly, one or more constituent entities of a multinational enterprise group.[Act No. 22 of 2022, s. 12, Act No. 4 of 2023, s. 16]19. Ascertainment of income of insurance companies
19A. Co-operative societies
20. Collective investment schemes
21. Members’ clubs and trade associations
22. Purchased annuities other than retirement annuities, etc.
22A. Deductions in respect of contributions to registered pension or provident funds
22B. Deductions in respect of registered individual retirement funds
22C. [Repealed by Act No. 8 of 2020, s. 6.]
23. Transactions designed to avoid liability to tax
24. Avoidance of tax liability by non-distribution of dividends
25. Income settled on children
26. Income from certain settlements deemed to be income of settlor
27. Accounting periods not coinciding with year of income, etc.
28. Income and expenditure after cessation of business
28A. Special Operating Framework Arrangement
A company which–(a)is engaged in business under a special operating framework arrangement with the Government;(b)incorporated for purposes of undertaking the manufacturer of human vaccines or other manufacturing activities including refining; and(c)whose capital investment is at least ten billion shillings,shall be subject to the rate of tax specified in the special operating framework arrangement with the Government.[Act No. 22 of 2022, s. 13, Act No. 4 of 2023, s. 18]Part V – PERSONAL RELIEF
29. General
30. Personal relief
A resident individual in receipt of taxable income shall be entitled to a tax relief in this Act referred to as the personal relief.[Act No. 12 of 1977, s. 5, Act No. 8 of 1996, s. 35.]30A. [Repealed by Act No. 12 of 2024, s. 10.]
[Act No. 9 of 2018, Sch., Act No. 2 of 2024, 3rd Sch., Act No. 12 of 2024, s. 10.]31. Insurance relief
31A. Post-retirement medical fund relief
A resident individual who proves that in a year of income the person has contributed to a post-retirement medical fund shall for that year of income be entitled to a personal relief in this Act referred to as the post-retirement medical fund relief.[ No. 4 of 2023, s. 20]32. [Deleted by Act No. 8 of 1991, s. 62.]
33. [Repealed by Act No. 8 of 1991, s. 62.]
Part VI – RATES, DEDUCTIONS AND SET-OFF OF TAX AND DOUBLE TAXATION RELIEF
A–Rates of Tax
34. Rates of tax
34A. [Repealed by Act No. 8 of 1978, s. 9(k).]
B – Deduction of Tax
35. Deduction of tax from certain income
36. Deduction of tax from annuities, etc., paid under a will, etc.
37. Deductions of tax from emoluments
37A. Penalty for failure to make deductions under section 35, 36 or 37
Where a corporate body which is required to make a deduction under sections 35, 36 or 37, fails to remit the deducted amount as required or directed by the Commissioner, every director and every officer of the corporate body concerned with the management thereof, shall be guilty of an offence, unless he proves to the satisfaction of the Court that he did not know, and could not reasonably be expected to know that the deducted amount had not been remitted and that he took all reasonable steps to ensure that the offence was not committed, and shall be liable to a fine of not less than ten thousand shillings but not more than two hundred thousand shillings or to imprisonment for a term not exceeding two years, or to both.[Act No. 8 of 1991, s. 63.]38. Application to Government
The provisions of this Part relating to deduction of tax shall bind the Government.C–Set-off of Tax
39. Set-off of tax
39A. [Repealed by Act No. 8 of 2009, s. 26.]
39B. Set-off tax rebate for apprenticeships
D-Double Taxation Relief
40. [Repealed by Act No. 8 of 1978, s. 9(m).]
41. Special arrangements for relief from double taxation
41A. Agreements for exchange of information
The Cabinet Secretary may, by notice in the Gazette, from time to time declare that arrangements made with the government of any country with the view of exchanging information relating to income tax or other taxes of a similar character imposed by the laws of that country, shall, notwithstanding anything to the contrary in this Act or any other written law, have effect in relation to income tax, and that notice shall, subject to the provisions of this section, have effect accordingly.[Act No. 4 of 2012, s. 17, Act No. 8 of 2021, s. 16.]42. Computation of credits under special arrangements
43. Time limit
Subject to section 42(7) of this Act, any claim for an allowance by way of credit under this Part shall be made to the Commissioner within six years from the end of the year of income to which it relates.Part VII – PERSONS ASSESSABLE
44. Wife’s income, etc.
Where under this Act the income of any person is chargeable to tax, then, subject to this Act, such income shall be assessed on, and the tax thereon charged on, such person.45. [Repealed by Act No. 4 of 2023, s. 22.]
46. Income of incapacitated person
The income of an incapacitated person shall be assessed on, and the tax thereon charged on, such person in the name of his trustee, guardian, curator, committee or receiver appointed by a court, in the same manner and to the like amount as such incapacitated person would have been assessed and charged if he were not an incapacitated person.47. Income of non-resident person
48. Income of deceased person, etc.
49. Liability of joint trustees
Where two or more persons are trustees, then any assessment made on the trustees in that capacity may be made on any one or more of them but each trustee shall be jointly and severally liable for the payment of tax charged in the assessment.50. Liability of person in whose name income of another person assessed
Any person in whose name the income of any other person is assessable under this Act shall be responsible, in relation to the assessment of such income, for doing all such things that are under this Act required to be done by a person whose income is chargeable to tax, and shall be responsible for the payment of tax so charged on him to the extent of any assets of such other person which are in his possession on, or may come into his possession after, the date of the service of a notice of assessment on him.51. Indemnification of representative
A person responsible under this Act for the payment of tax on behalf of another person may retain out of any money coming to his hands on behalf of such other person so much thereof as is sufficient to pay such tax, and such person is hereby indemnified against any claim whatsoever for all payments so made by him.51A. [Repealed by Act No. 38 of 2016, s. 11.]
Part VIII – RETURNS AND NOTICES
52. Returns of income and notice of chargeability
52A. [Deleted by Act No. 8 of 1996, s. 40.]
52B. Final return with self-assessment
53. [Repealed by Act No. 16 of 2014, s. 13.]
54. Documents to be included in return of income
54A. Keeping of records of receipts, expenses, etc.
54B. Supply of information upon change in particulars
Every person carrying on a business shall notify the Commissioner of any changes in the following particulars within thirty days of the occurrence of the change–(a)the place of business, trading name and contact address;(b)in the case of–(i)an incorporated person, of the persons with shareholding of ten per cent or more of the issued share capital;(ii)a nominee ownership, to disclose the beneficial owner of the shareholding;(iii)a trust, full identity and address details of trustees, settlors and beneficiaries of the trust;(iv)a partnership, the identity and address of all partners; or(v)cessation or sale of business, all relevant information regarding liquidation or details of new ownership.[Act No. 16 of 2014, s. 15.]55. Books and accounts
56. [Deleted by Act No. 29 of 2015, 2nd Sch.]
57. Return as to salaries, pensions, etc.
58. Return as to fees, commissions, royalties, etc.
59. Occupier’s return of rent
The Commissioner may, by notice in writing, require any person who is the occupier of premises to furnish him within a reasonable time, not being less than thirty days from the date of service of such notice, with a return containing–(a)the name and address of the owner or lessor of such premises; and(b)a full and true statement of the rent or any other consideration payable for the occupation thereof.60. Return of lodgers and inmates
The Commissioner may, by notice in writing, require a person who provides accommodation for any lodger or inmate to furnish him within a reasonable time, not being less than thirty days from the date of service of such notice, with a return containing the name of every lodger or inmate who is at the date of the notice resident in his house, hotel or institution, and who has (except for temporary absences) been so resident throughout the three months prior to such date of the notice.61. Return of income received on account of other persons
The Commissioner may, by notice in writing, at any time require any person who is in receipt of income as the representative of, or on behalf of, any other person who is chargeable to tax in respect thereof, or who would be so chargeable if he were a resident person, to furnish him within a reasonable time, not being less than thirty days from the date of service of such notice, with a return containing–(a)a full and true statement of the income; and(b)the name and address of the person to whom it belongs.62. Return as to income exempt from tax
The Commissioner may, by notice in writing, require a person to furnish him within a reasonable time, not being less than thirty days from the date of service of such notice, with a return containing a full and true statement–(a)of all the income of that person which is exempt from tax or which such person claims to be so exempt;(b)of all such particulars as the Commissioner may specify in such notice in relation to such income and in relation to any assets from which that income is derived.63. Return in relation to settlements
The Commissioner may, by notice in writing, require the trustees of, or a party to, a settlement referred to in section 25 or 26 of this Act to furnish him within a reasonable time, not being less than thirty days from the date of service of such notice, with a return containing such particulars as he may consider necessary for the purposes of those sections.64. Return in relation to registered pension fund, etc.
The Commissioner may, by notice in writing, require the trustees of a registered pension fund or pension scheme and an employer who contributes to any such fund to furnish him within a reasonable time, not being less than thirty days from the date of service of such notice, with a return containing–(a)the name and place of residence of every person in receipt of any payment made under the regulations of such fund or scheme;(b)the amount and nature of any such payment;(c)a copy of the accounts of any such fund or scheme up to the last date prior to such notice to which such accounts have been made up; and(d)such further information and particulars in connexion with any such fund or scheme or the regulations relating thereto as the Commissioner may require.65. Return of annuity contract benefits
The Commissioner may, by notice in writing, at any time require any person by whom benefits are payable under any annuity contract to furnish him within a reasonable time, not being less than thirty days from the date of service of such notice, with a return giving the full name and address of each person to whom any annuity has been paid and the amount of the annuity so paid during any year of income.66. Return of resident company dividends
The Commissioner may, by notice in writing, at any time require any resident company which pays a dividend to furnish him within a reasonable time, not being less than thirty days from the date of service of such notice, with a return giving the full name and address of each shareholder to whom such dividend was paid and, in respect of each shareholder, full particulars of his shareholding at the date of declaration of such dividend, the gross amount paid or payable to him, the tax deducted thereupon and such other particulars that the Commissioner may require, as notified generally by notice published in the Gazette or as specified by notice in writing to any particular resident company.67. Return as to interest paid or credited by banks, etc.
68. Return as to dividends paid by building societies
69. [Deleted by Act No. 29 of 2015, 2nd Sch.]
70. [Deleted by Act No. 29 of 2015, 2nd Sch.]
71. [Deleted by Act No. 29 of 2015, 2nd Sch.]
72. [Repealed by Act No. 38 of 2016, s. 12.]
72A. [Deleted by Act No. 29 of 2015, 2nd Sch.]
72B. Penalty for the negligence of authorized tax agent
72C. Penalty on underpayment of instalment tax
72D. [Repealed by Act No. 23 of 2019, s. 13.]
Part IX – ASSESSMENTS
73. Assessments
74. [Repealed by Act No. 16 of 2014, s. 17.]
74A. Instalment assessment
74B. [Deleted by Act No. 29 of 2015, 2nd Sch.]
75. [Deleted by Act No. 29 of 2015, 2nd Sch.]
75A. [Repealed by Act No. 38 of 2016, s. 13.]
75B. [Deleted by Act No. 29 of 2015, 2nd Sch.]
76. Assessment not to be made on certain employees
The Commissioner shall not assess an employee for any year of income–(a)if such employee had no income chargeable to tax for such year of income other than income consisting of emoluments; and(b)if on the basis of such emoluments and the personal reliefs to which such employee is entitled the tax payable by that employee in respect of those emoluments has been recovered by deduction under section 37 of this Act,unless, prior to the expiry of seven years after that year of income, such employee applies to the Commissioner to be assessed, whether in connexion with a claim for repayment of tax or otherwise, or the Commissioner considers an assessment to be necessary or expedient so as to arrive at the correct amount of the tax to be charged upon or to be payable by such employee for such year of income.76A. Assessment not to be made on certain incomes
The Commissioner shall not assess any person for any year of income on that portion of income which has been subject to withholding tax which is also a final tax.[Act No. 8 of 1991, s. 67.]77. [Deleted by Act No. 29 of 2015, 2nd Sch.]
78. [Deleted by Act No. 29 of 2015, 2nd Sch.]
79. [Deleted by Act No. 29 of 2015, 2nd Sch.]
80. [Deleted by Act No. 29 of 2015, 2nd Sch.]
81. [Deleted by Act No. 29 of 2015, 2nd Sch.]
Part X – OBJECTIONS, APPEALS AND RELIEF FOR MISTAKES
82. [Repealed by Act No. 40 of 2013, s. 42.]
83. [Repealed by Act No. 40 of 2013, s. 42.]
84. [Deleted by Act No. 29 of 2015, 2nd Sch.]
85. [Deleted by Act No. 29 of 2015, 2nd Sch.]
86. Deleted by Act No. 29 of 2015, 2nd Sch.
87. [Deleted by Act No. 29 of 2015, 2nd Sch.]
88. [Deleted by Act No. 29 of 2015, 2nd Sch.]
89. [Deleted by Act No. 29 of 2015, 2nd Sch.]
90. [Deleted by Act No. 29 of 2015, 2nd Sch.]
91. [Deleted by Act No. 29 of 2015, 2nd Sch.]
91A. [Deleted by Act No. 29 of 2015, 2nd Sch.]
Part XI – COLLECTION, RECOVERY AND REPAYMENT OF TAX
92. Time within which payment is to be made
92A. Due date for payment of tax under self-assessment
93. [Deleted by Act No. 29 of 2015, 2nd Sch.]
94. [Deleted by Act No. 29 of 2015, 2nd Sch.]
95. [Deleted by Act No. 29 of 2015, 2nd Sch.]
95A. [Repealed by Act No. 4 of 1993, s. 56.]
96. [Deleted by Act No. 4 of 1993, s. 56.]
96A. [Deleted by Act No. 29 of 2015, 2nd Sch.]
97. Deceased persons
Where a person dies, then to the extent to which–(a)tax charged in an assessment made upon him has not been paid; or(b)his executors are charged to tax in an assessment made under section 48 of this Act,the amount of tax unpaid or charged, as the case may be, in the assessment as finally determined shall be a debt due and payable out of his estate.98. [Repealed by Act No. 38 of 2016, s. 14.]
99. [Repealed by Act No. 9 of 2000, s. 53.]
100. [Deleted by Act No. 9 of 2000, s. 53.]
101. [Deleted by Act No. 29 of 2015, 2nd Sch.]
102. [Deleted by Act No. 29 of 2015, 2nd Sch.]
103. [Deleted by Act No. 29 of 2015, 2nd Sch.]
104. Collection of tax from ship owner, etc.
105. [Repealed by Act No. 38 of 2016, s. 15.]
106. Repayment of tax in respect of income accumulated under trusts
Part XII – OFFENCES AND PENALTIES
107. General penalty
A person guilty of an offence under this Act for which no other penalty is specifically provided shall be liable to a fine not exceeding one hundred thousand shillings or to imprisonment for a term not exceeding six months or to both.[Act No. 8 of 1996, s. 43.]108. [Repealed by Act No. 15 of 2017, s. 14.]
109. Failure to comply with notice, etc.
110. [Deleted by Act No. 29 of 2015, 2nd Sch.]
111. [Deleted by Act No. 29 of 2015, 2nd Sch.]
112. [Deleted by Act No. 29 of 2015, 2nd Sch.]
113. [Deleted by Act No. 29 of 2015, 2nd Sch.]
114. [Deleted by Act No. 29 of 2015, 2nd Sch.]
115. [Deleted by Act No. 29 of 2015, 2nd Sch.]
116. [Deleted by Act No. 29 of 2015, 2nd Sch.]
117. [Deleted by Act No. 29 of 2015, 2nd Sch.]
118. [Deleted by Act No. 29 of 2015, 2nd Sch.]
119. [Deleted by Act No. 29 of 2015, 2nd Sch.]
120. [Deleted by Act No. 29 of 2015, 2nd Sch.]
121. [Deleted by Act No. 29 of 2015, 2nd Sch.]
Part XIII – ADMINISTRATION
122. [Deleted by Act No. 29 of 2015, 2nd Sch.]
123. [Deleted by Act No. 29 of 2015, 2nd Sch.]
123A. [Deleted by Act No. 29 of 2015, 2nd Sch.]
123B. [Deleted by Act No. 29 of 2015, 2nd Sch.]
123C. [Deleted by Act No. 29 of 2015, 2nd Sch.]
124. [Deleted by Act No. 29 of 2015, 2nd Sch.]
125. [Deleted by Act No. 29 of 2015, 2nd Sch.]
126. [Deleted by Act No. 29 of 2015, 2nd Sch.]
Part XIV – MISCELLANEOUS PROVISIONS
127. [Deleted by Act No. 29 of 2015, 2nd Sch.]
127A. [Deleted by Act No. 29 of 2015, 2nd Sch.]
127B. [Deleted by Act No. 29 of 2015, 2nd Sch.]
127C. [Deleted by Act No. 29 of 2015, 2nd Sch.]
127D. [Deleted by Act No. 29 of 2015, 2nd Sch.]
127E. [Deleted by Act No. 29 of 2015, 2nd Sch.]
128. [Deleted by Act No. 29 of 2015, 2nd Sch.]
129. [Deleted by Act No. 29 of 2015, 2nd Sch.]
130. Rules
The Cabinet Secretary may make rules prescribing anything which is to be prescribed under, and generally for carrying out the provisions of, this Act.131. Exemption from stamp duty
All securities of whatsoever nature over property, movable or immovable, and all transfers of such property in favour of or by the Commissioner shall be exempt from stamp duty.132. [Deleted by Act No. 29 of 2015, 2nd Sch.]
133. Repeals and transitional
History of this document
27 December 2024 this version
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01 January 2022
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Finance Act, 2021
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01 July 2021
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Finance Act, 2021
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01 January 2021
Amended by
Tax Laws (Amendment)(No. 2) Act, 2020
30 June 2020
Amended by
Finance Act, 2020
25 April 2020
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Tax Laws (Amendment) Act, 2020
18 March 2020
Amended by
Business Laws (Amendment) Act, 2020
07 November 2019
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Finance Act, 2019
01 January 2019
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Finance Act, 2018
01 July 2018
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Tax Laws (Amendment) Act, 2018
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Finance Act, 2018
01 January 2018
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Finance Act, 2017
04 May 2017
03 April 2017
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Finance Act, 2017
01 January 2017
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Finance Act, 2016
01 July 2016
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Finance Act, 2016
09 June 2016
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Finance Act, 2016
19 January 2016
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Tax Procedures Act
01 January 2016
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Finance Act, 2015
01 April 2015
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Tax Appeals Tribunal Act
01 January 2015
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Finance Act, 2014
03 October 2014
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Finance Act, 2014
19 September 2014
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Finance Act, 2014
13 June 2014
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Finance Act, 2014
01 January 2014
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Finance Act, 2013
01 July 2013
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Finance Act, 2012
01 February 2013
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Finance Act, 2012
01 January 2013
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Finance Act, 2012
15 June 2012
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Finance Act, 2012
01 January 2012
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09 June 2011
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Finance Act, 2012
01 January 2011
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Finance Act, 2010
11 June 2010
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01 January 2010
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12 June 2009
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01 January 2009
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01 October 2008
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13 June 2008
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01 January 2008
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15 June 2007
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01 January 2007
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09 November 2006
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12 July 2006
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01 July 2006
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16 June 2006
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01 January 2006
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01 July 2005
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09 June 2005
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08 June 2005
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07 January 2005
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01 January 2005
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01 July 2004
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Finance Act, 2004
11 June 2004
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Finance Act, 2004
10 June 2004
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Finance Act, 2004
01 January 2004
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Finance Act, 2003
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Finance Act, 2004
01 July 2003
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Finance Act, 2003
12 June 2003
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Finance Act, 2003
13 June 2002
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Finance Act, 2002
14 June 2001
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Finance Act, 2001
01 January 2000
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Finance Act, 1999
10 June 1999
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Finance Act, 1999
11 June 1998
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Finance Act, 2000
18 June 1996
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Finance Act, 1996
01 January 1996
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Finance Act, 1995
16 June 1995
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Finance Act, 1995
01 January 1995
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Finance Act, 1994
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Finance Act, 1995
01 October 1994
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Finance Act, 1994
01 July 1994
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Finance Act, 1994
17 June 1994
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Finance Act, 1994
01 January 1994
01 July 1993
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Finance Act, 1993
11 June 1993
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Finance Act, 1993
01 January 1993
05 June 1992
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Finance Act, 1992
01 January 1992
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Finance Act, 1994
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Finance Act, 2004
13 June 1991
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Finance (No.2) Act,1991
01 January 1991
Amended by
Finance (No. 2) Act, 1990
Amended by
Finance (No.2) Act,1991
Amended by
Finance Act, 1992
Amended by
Finance Act, 1993
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Finance Act, 1994
22 June 1990
07 June 1990
Amended by
Finance (No. 2) Act, 1990
18 January 1990
01 January 1990
Amended by
Finance (No. 2) Act, 1990
29 December 1989
01 November 1989
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Banking Act
01 September 1989
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Cotton Act
01 July 1989
Amended by
Finance Act, 1987
Amended by
Finance (No. 2) Act, 1989
16 June 1989
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Finance (No. 2) Act, 1989
01 January 1989
Amended by
Finance Act, 1988
Amended by
Finance (No. 2) Act, 1989
Amended by
Finance (No. 2) Act, 1990
17 June 1988
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Finance Act, 1988
01 January 1988
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Finance Act, 1987
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Finance Act, 1992
12 June 1987
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Finance Act, 1987
01 January 1987
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Finance Act, 1986
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Finance Act, 1987
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Finance Act, 1992
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Finance Act, 1992
13 June 1986
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Finance Act, 1986
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Finance (No. 2) Act, 1989
01 January 1986
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Finance Act, 1985
14 June 1985
Amended by
Finance Act, 1985
01 January 1985
Amended by
Finance Act, 1984
Amended by
Finance Act, 1985
28 December 1984
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Income Tax (Amendment) Act, 1984
15 June 1984
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Finance Act, 1984
01 January 1984
Amended by
Income Tax (Amendment) Act, 1984
18 June 1982
Amended by
Finance Act (No. 3),1982
01 January 1982
Amended by
Finance Act, 1981
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Finance Act (No. 3),1982
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Finance Act, 1983
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Finance Act, 1988
18 December 1981
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Finance Act, 1982
24 June 1981
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Finance Act, 1983
17 June 1981
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Finance Act, 1981
01 January 1981
01 January 1980
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Finance Act, 1979
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Finance Act (No. 2) Act, 1980
07 September 1979
03 September 1979
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Finance Act, 1981
08 June 1979
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Finance Act, 1979
10 November 1978
01 January 1978
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Finance Act, 1978
28 October 1977
17 June 1977
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Finance Act, 1977
18 June 1976
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Finance Act, 1976
13 June 1975
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Income Tax (Amendment) Act, 1976
07 March 1975
Amended by
Finance Act, 1975
01 January 1975
Amended by
Finance Act (No. 2) Act, 1975
01 January 1974
Commenced
28 December 1973
Published in Kenya Gazette 55
21 December 1973
Assented to
Cited documents 42
Act 39
1. | Companies Act | 1665 citations |
2. | Tax Procedures Act | 1414 citations |
3. | Kenya Revenue Authority Act | 1241 citations |
4. | Tax Appeals Tribunal Act | 955 citations |
5. | Public Finance Management Act | 723 citations |
6. | Insolvency Act | 661 citations |
7. | Kenya Information and Communications Act | 632 citations |
8. | Co-operative Societies Act | 430 citations |
9. | Banking Act | 377 citations |
10. | Insurance Act | 292 citations |
Legal Notice 3
Documents citing this one 842
Judgment 807
Act 17
1. | Tax Procedures Act | 1414 citations |
2. | Kenya Revenue Authority Act | 1241 citations |
3. | Tax Appeals Tribunal Act | 955 citations |
4. | Value Added Tax Act | 521 citations |
5. | Co-operative Societies Act | 430 citations |
6. | Banking Act | 377 citations |
7. | Proceeds of Crime and Anti-Money Laundering Act | 330 citations |
8. | Statutory Instruments Act | 231 citations |
9. | National Social Security Fund Act | 85 citations |
10. | Prisons Act | 83 citations |
Legal Notice 17
Gazette Notice 1
1. | The Gold Mines Development Loans Rules |