How to File your Capital Gains Tax (CGT) Returns

File your Withholding Tax Returns
File your Withholding Tax Returns

What is Capital Gains Tax (CGT)?

CGT is the tax that is levied on the transfer of property situated in Kenya, acquired on or before January 2015.

It is declared and paid by the transferor of the property

Rate of Tax

The rate of tax is 5% of the net gain. 
It is a final tax i.e. the Capital Gain is not subject to further taxation after payment of the 5% rate of tax.
Net Gain is Sales Proceeds minus the Acquisition and Incidental cost
CGT is on gains arising from sale of property.

Exemptions on Capital Gains Tax

  1. Income that is taxed elsewhere as in the case of property dealers
  2. Issuance by a company of its own shares and debentures
  3. Disposal of property for purpose of administering the estate of a deceased person
  4. Transfer of property between spouses as part of divorce settlement
  5. A private residence if the individual owner has occupied the residence continuously for the three-year period immediately prior to the transfer
  6. Agricultural property having an area of less than 100 acres where that property is situated outside a municipality or urban area 

How do I pay for Capital Gains Tax? 

  1. You can either pay in installments, in advance or at the end of the accounting period.
  2. Payment should be initiated online via iTax. 
  3. The modes of payment include cash, cheque or RTGS. 
  4. After initiating payment, you will receive a payment slip. 
  5. Present the payment slip at any KRA appointed bank with the due tax to complete payment.

Note: The payment slip expires within 30 days.