Here is an article summarising the Kenya Finance Bill 2025, Part Two, based on our YouTube video: Kenya Finance Bill 2025: Proposed Changes to Income Tax Act
The video provides a detailed overview of Part Two of the Kenya Finance Bill 2025, focusing on proposed amendments to the Income Tax Act. The video highlights key changes, section by section, aiming to make these potential shifts understandable.
Key Points:
a. Definitions: Several definitions are being revised, amended, or deleted. This includes “debenture” [01:24], “individual retirement fund” [02:03], and “royalty” (with a new inclusion for software distribution) [02:39]. The definitions of “compensating tax,” “tribunal,” and “venture company” are proposed for deletion [03:18]. A significantly broader definition of “related person” is also proposed [04:01].
b. Monetary Thresholds: The proviso to subsection 2 sees a proposed increase in a monetary threshold from 2,000 to 10,000 shillings [05:16].
d. Taxable Income: Two new items are proposed to be added to what counts as taxable income: supply of goods to a public entity and the sale of scrap [06:49].
f. Minimum Tax: A new subsection 3A proposes a “minimum top-up tax” payable by the end of the fourth month after the year of income [07:58].
h. Other Amendments:
The video briefly mentions a wide range of other proposed changes affecting sections related to gross investment receipts [10:10], commissioner deadlines [10:17], shipping income [10:25], employee allowances and benefits (with more specific rules and limits) [10:33], individual income [11:24], company self-assessment liability [11:24], repeal of certain sections [11:33], information sharing and penalties [11:40], and the schedules at the back of the act [11:55] (including changes to tax-exempt income and fringe benefits) [11:55.
Important Note:
The video emphasizes the proposed changes. Viewers are encouraged to review the full Finance Bill 2025 and seek professional advice to understand the potential impact on their specific situations [13:54].
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