JANUARY 2025 – KENYA
TAX LAWS (AMENDMENT) ACT, 2024 UPDATE
It is important that employers note the following:
The Tax Laws (Amendment) Act, 2024 effective from 27 December 2024
On 11 December 2024, the President assented to the Tax Laws (Amendment) Bill, 2024 (the Tax Laws Amendment Act) and the Tax Procedures (Amendment) Bill, 2024 (the Tax Procedures Amendment Act), enacting them into law. The Acts were subsequently gazetted and published on 13 December 2024.
The Tax Laws (Amendment) Act, 2024 is effective from 27 December 2024 and introduces significant changes to tax thresholds and reliefs that impact payroll and PAYE calculations. Our CRS News Flash of 21 November 2024 contains more information and can be viewed here.
In addition, the Kenya Revenue Authority (KRA) published a public notice on 19 December 2024 regarding the PAYE computation. The updated P10 return is also available for downloading in the public notice.
The KRA has clarified the following:
- The changes come into effect on 27 December 2024 and apply to the PAYE calculation for December 2024 and subsequent periods.
- Employers who have already finalised and paid December 2024 payroll may adjust the tax in the following pay period (January 2025).
To view the Tax Laws (Amendment) Act, 2024, follow the link.
To view the KRA public notice, follow the link.