Finance Bill Explorer
Search and explore the complete Finance Bill 2025 with full clause text and comprehensive analysis
Search & Filter Clauses
Short Title and Commencement
Establishes the Finance Act 2025 and sets commencement dates for different sections
🎯Key Provisions:
- ✓Most sections effective 1st July 2025
- ✓Sections 12 and 56 effective 1st January 2026
- ✓Official title: Finance Act, 2025
Income Tax Act Definitions Amendment
Amends key definitions in the Income Tax Act including debenture, individual retirement fund, royalty, and related person
🎯Key Provisions:
- ✓Expands royalty definition to include software distribution
- ✓Removes compensating tax definition
- ✓Clarifies related person definition for family relationships
- ✓Removes various obsolete definitions
Per Diem Benefits Increase
Increases tax-free per diem limit from KES 2,000 to KES 10,000 per day for employees working away from usual workplace
🎯Key Provisions:
- ✓Per diem increased from KES 2,000 to KES 10,000 per day
- ✓Applies to official duties away from usual workplace
- ✓Tax-free reimbursement for subsistence expenses
Employment Income Gender Neutral Language
Updates Income Tax Act language to be gender neutral and removes obsolete subsections
🎯Key Provisions:
- ✓Replaces "husband" with "spouse"
- ✓Removes multiple obsolete subsections
- ✓Modernizes legislative language
Withholding Tax Expansion
Expands withholding tax to include supply of goods to public entities and sale of scrap
🎯Key Provisions:
- ✓New withholding tax on goods supplied to public entities
- ✓Withholding tax on scrap sales
- ✓Expands government revenue collection
Significant Economic Presence Tax Expansion
Expands SEP tax to all internet and electronic networks, removes KES 5 million threshold
🎯Key Provisions:
- ✓Covers all internet and electronic networks
- ✓No minimum threshold for non-residents
- ✓6% tax on deemed 10% profit margin
Minimum Top-up Tax Payment Date
Sets payment deadline for minimum top-up tax to fourth month after year end
🎯Key Provisions:
- ✓Payment due by fourth month after year end
- ✓Applies to multinational enterprises
- ✓Implements OECD Pillar Two requirements
Housing Tax Relief and Business Deductions
Expands mortgage interest relief to include self-built homes, limits business loss carryforward to 5 years, and removes various deductions
🎯Key Provisions:
- ✓Self-built homes now qualify for relief
- ✓Construction costs deductible
- ✓Business loss carryforward limited to 5 years
- ✓Removes various obsolete deductions
- ✓Sports facility construction deductions expanded
Deductions Not Allowed - eTIMS Requirements
Removes compensating tax references and clarifies electronic invoice requirements for deductions
🎯Key Provisions:
- ✓Removes compensating tax references
- ✓Clarifies electronic invoice requirements
- ✓Streamlines deduction rules
Transfer Pricing Simplification
Removes complex transfer pricing subsection to simplify regulations
🎯Key Provisions:
- ✓Removes complex transfer pricing rules
- ✓Simplifies compliance for businesses
- ✓Streamlines international transactions
Country-by-Country Reporting Updates
Updates country-by-country reporting requirements for multinational enterprises
🎯Key Provisions:
- ✓Clarifies reporting obligations
- ✓Updates notification requirements
- ✓Aligns with international standards
Advance Pricing Agreements
Introduces Advance Pricing Agreements for multinational companies on transfer pricing
🎯Key Provisions:
- ✓5-year validity period
- ✓Reduces transfer pricing disputes
- ✓Provides tax certainty
- ✓Can be voided for misrepresentation
Digital Asset Tax Reduction
Reduces digital asset tax from 3% to 1.5% of transfer value
🎯Key Provisions:
- ✓Rate reduced from 3% to 1.5%
- ✓Applies to digital asset transfers
- ✓Encourages regulated platform usage
Business Loss Carryforward Limitation
Limits carry forward of business tax losses to 5 years instead of indefinitely
🎯Key Provisions:
- ✓Loss carryforward capped at 5 years
- ✓Previously unlimited carryforward
- ✓Affects long-term investment projects
KRA Data Access Enhancement
Enhances KRA's data access powers for tax compliance while protecting sensitive information
🎯Key Provisions:
- ✓Real-time cross-sectoral data integration
- ✓Advanced analytics for evasion detection
- ✓Protects honest taxpayers from unfair burden
VAT Changes on Clean Technology
Moves electric bicycles, mobile phones, and clean energy products from zero-rated to exempt
🎯Key Provisions:
- ✓Electric bicycles moved to exempt status
- ✓Solar batteries exemption changes
- ✓Mobile phones VAT structure modified
Excise Duty on Imported Plastics
Introduces structured excise duties on imported plastic products at 25% or KES 200 per kg
🎯Key Provisions:
- ✓25% or KES 200 per kg duty rate
- ✓Covers various plastic products
- ✓Excludes EAC origin products
System Error Penalty Waiver
Allows waiver of penalties caused by electronic tax system errors or malfunctions
🎯Key Provisions:
- ✓Waiver for system-generated errors
- ✓Covers duplicated penalties
- ✓Protection from technical failures
NIFC Tax Incentives
Introduces reduced corporate tax rates for NIFC-certified companies and startups
🎯Key Provisions:
- ✓15% rate for first 10 years (vs 30% standard)
- ✓20% rate for subsequent 10 years
- ✓Special startup rates available
Advance Pricing Agreements
Introduces Advance Pricing Agreements for multinational companies on transfer pricing
🎯Key Provisions:
- ✓5-year validity period
- ✓Reduces transfer pricing disputes
- ✓Provides tax certainty
Electronic Tax Invoice System
Refines electronic tax invoice requirements to exclude certain transaction types
🎯Key Provisions:
- ✓Excludes routine employment payments
- ✓Simplified for specific transactions
- ✓Reduces compliance burden
NIFC Dividend Exemptions
Exempts dividends from NIFC companies that reinvest at least KES 250 million in Kenya
🎯Key Provisions:
- ✓Dividend exemption for qualifying companies
- ✓Minimum KES 250M annual reinvestment
- ✓Promotes capital retention in Kenya
Property Security Enhancements
Provides stamp duty exemption for property transfers under agreed payment plans
🎯Key Provisions:
- ✓Stamp duty exemption for payment plans
- ✓Flexible debt settlement options
- ✓Reduces transaction costs
Stamp Duty Internal Reorganization Exemption
Exempts stamp duty on property transfers during internal company reorganizations
🎯Key Provisions:
- ✓Exemption for internal reorganizations
- ✓Proportional shareholder transfers
- ✓Subsidiary share transfers included
📚 Comprehensive Bill Analysis
Complete Finance Bill 2025 text from Kenya Gazette Supplement No. 63. Search through all clauses, parts, and sections with full legislative text and strategic analysis.