Foreign-Owned Company in Kenya: First-Year Compliance Calendar

A foreign-owned company that has just been incorporated in Kenya faces a steady rhythm of filing and payment dates, and the routine dates are easy to miss. This calendar sets out the recurring dates in the first year, with the statutory source for each, so that a foreign parent and its Kenyan management can agree who owns each task. Dates in a company’s own year depend on its incorporation date and financial year end, so treat the annual items as a pattern, not a fixed diary.

Set up in the first weeks

Beneficial ownership. Every company must keep a register of its beneficial owners, and a proposed company lodges a copy with its incorporation documents (section 93A of the Companies Act, 2015). A private company must lodge any amendment to the register within fourteen days of making it, and must keep beneficial owner records for at least ten years after a person ceases to be one. A change in the foreign parent’s own ownership can therefore start a fourteen-day clock in Kenya. Our article on beneficial ownership filings with the Business Registration Service sets out the mechanics.

VAT registration. A person who makes, or expects to make, taxable supplies worth five million shillings or more in any twelve months, or who is about to start making supplies reasonably expected to exceed that amount, is liable to register and must apply within thirty days of becoming liable (section 34 of the Value Added Tax Act, 2013). A start-up billing Kenyan customers should track the threshold from its first invoice. See our guide to mandatory eTIMS invoicing for the invoicing side.

Payroll registrations. An employer needs to be registered for the payroll deductions below before the first salary is paid. Our articles on SHIF and NSSF employer registration and on payroll registration for foreign employers cover how.

Every month

By the 9th of the month:

• PAYE. An employer must deduct and account for tax on emoluments (section 37 of the Income Tax Act). Section 37(5) leaves the time limit to rules made under the Act, and the Kenya Revenue Authority states that PAYE is due on or before the 9th of the following month.
• NSSF. The employer pays its own contribution and the employee’s contribution at six per cent each of pensionable earnings, on the ninth day of each month or on such later date as the Board may prescribe (section 20(1) and (1A) of the National Social Security Fund Act, 2013).
• SHIF. A household with salaried income pays a monthly statutory deduction of 2.75 per cent of gross salary, at least KES 300, by the ninth day of each month (regulation 17 of the Social Health Insurance Regulations, 2024).

By the ninth working day after month end: the Affordable Housing Levy, at 1.5 per cent of the employee’s gross salary, with the employer remitting an equal amount (sections 4 and 5 of the Affordable Housing Act, 2024). This date counts working days, so it usually falls after the 9th. Putting it on the same reminder as NSSF is a common error.

By the 20th of the month: the VAT return. A registered person submits a return for each tax period not later than the twentieth day after the end of that period (section 44), and may defer payment to not later than the twentieth day of the following month (section 19(2)). Section 44 and section 19 work together, so file and pay on the same date.

Every quarter: instalment tax

The Income Tax Act sets out instalment tax payable in four proportions of twenty-five per cent each, due on or before the twentieth day of the fourth, sixth, ninth and twelfth months of the company’s accounting period. The Kenya Revenue Authority applies this where the projected annual liability is above KES 40,000. Agricultural companies follow a different split. Your accountant should compute the first instalment from the company’s projected profit, not leave it to year end.

Once a year

• Balance of income tax. The Kenya Revenue Authority states that any balance is due on or before the last day of the fourth month after the year end.
• Income tax return. The return with a self-assessment is due not later than the last day of the sixth month following the end of the year of income (section 52B of the Income Tax Act). For a 31 December year end, that is 30 June.
• Annual return to the Registrar. A company’s return date is the anniversary of its incorporation, or of the date its last return was made up to. It must lodge the return within twenty-eight days after the date to which it is made up, signed by a director or the secretary (section 705 of the Companies Act). The return states the registered office, type of company and principal business, directors and authorised signatories, financial statements or an exemption statement, and whether the beneficial owner register has changed (section 706(1)).

The Registrar’s annual return and the Kenya Revenue Authority’s income tax return are separate filings with different dates.

Practical points for a foreign parent

• Name one person in Kenya as owner of the monthly 9th, ninth working day and 20th reminders, and agree how the parent funds the payments in time.
• Confirm each rate and date against the current law before relying on it. The NSSF Board may prescribe a later payment date, and rates can change.
• Keep the bank account in view. Payments of statutory deductions need funded local accounts. See opening a bank account for a foreign-owned company.

Frequently asked questions

This article is general information on Kenyan law as at its publication date, not legal advice. Reading it does not create an advocate and client relationship.