Banking, Money and Taxes in Kenya

Opening a bank account will likely be a priority for you when relocating to Kenya. Fortunately, banking in Kenya is easy and efficient, and banks can be found in most major towns and cities.

Although the process is straightforward, you will need to follow specific steps and provide certain documents to open a bank account, such as presenting a copy of your employment contract and proof of a local address.

Money in Kenya

The official currency in Kenya is the Kenyan Shilling (KES), subdivided into 100 cents.

• Notes: KES 5, 10, 20, 50, 100, 200, 500 and 1,000
• Coins: 50 cents (rarely used), KES 1, 5, 10 and 20

When moving to Kenya, you will need to exchange currency for the local shillings. You can exchange money at international airports, in bureaux de change, and certain banks in major cities. Some hotels may offer local currency, but the rate might not be so favourable.

Banking in Kenya

Many large international banks have branches in Nairobi or partnerships with local banks. This can make transferring money between your home country and Kenya easier. Inform your home bank about your relocation to ensure a smooth process.

The largest banks are Absa Bank Kenya and Standard Chartered Kenya, which are international, and KCB Bank Kenya, Co-operative Bank of Kenya, and Equity Bank Kenya, which are local. All banks follow the guidelines and management issued by the Central Bank of Kenya (CBK).

It's useful to have cash on hand in Kenya. Bank card payments are common, especially with Visa and Mastercard, although some areas, markets, and shops only accept cash payments.

Banking hours in Kenya are mainly from 9am to 3pm, Monday to Friday. Some banks may open earlier and close later. Banks often close around midday on Saturdays and remain closed on Sundays.

Opening a bank account

When opening a bank account in Kenya, watch out for account fees. Visit different banking websites and research their services and account types. Check if a fixed monthly fee or an individual fee per transaction is charged.

After finding a suitable bank, visit the nearest branch in person. They will assist with setting up your account. Processing the necessary documents shouldn't take long, and your account should be activated within a day or so.

Opening an account at any of Kenya's banks is straightforward, though required documents vary. Check if a Kenya Revenue Authority (KRA) PIN or tax number is needed or if a local phone number is enough.

You will generally need to present identification, such as your passport, along with proof of your Kenyan address. This can be a utility bill or a similar statement that shows your name and address.

Credit cards and ATMs

ATMs are easily found in Kenya's big cities, and several banks have effective online banking services. Restaurants and shopping malls in major cities have credit card facilities, but charges can be high. It's often better to pay with a local debit card or cash.

Taxes in Kenya

You should be aware of the tax implications when working in Kenya. The Kenya Revenue Authority (KRA) manages all tax-related matters in the country. Their website is comprehensive, offering several online services and tax guides. If you are not clued up on accounting and tax processes, it’s best to enlist the services of tax specialists. They will be familiar with the latest guidelines.

Income tax in Kenya is on a graduated scale based on your earnings. Rates range from 10% to 35%. Non-cash benefits, such as housing, utilities, and company cars, are also taxed. Expat employees often receive generous employment packages, including benefits like housing, utilities, furniture, a company car, and school fees for dependents.

You may wonder what it means to be considered a resident for tax purposes. In Kenya, this includes anyone with a permanent home in the country or those present for at least 183 days in one tax year. It also includes those without a permanent home but who have resided in Kenya during the tax year and the previous two years for at least 122 days a year.

If you are considered a resident for tax purposes, you are liable for tax on income generated both in Kenya and abroad. Non-residents are only taxed on income earned in and derived from Kenya.

Kenya has double-taxation treaties with several countries, including Canada, the United Kingdom, South Africa, Germany and the United Arab Emirates. You should find out if your home country is part of a double-taxation agreement, which exempts you from certain taxes abroad.

Getting a tax number

If you are working in Kenya and considered a resident for tax purposes, you should obtain a tax number or KRA PIN.

Once your work permit has been processed, you will receive an Alien Card. This allows you to register with the KRA and obtain a KRA PIN. Visiting the KRA website, you will find instructions and an online form. You will need to provide your Alien ID card, basic information, and company details. After processing, you will get your tax number.

This number is used for filing self-assessment tax returns, due at the end of June each year. While employers deduct tax from their employees' incomes, you must submit these tax returns. We recommend asking for support from a tax adviser.

Useful links

• Kenya Revenue Authority
• KRA PIN Registration
• Alien Card Registration