Capital Gains Tax (CGT)- What you need to Know

· Capital Gains Tax is tax that is levied on transfer of property situated in Kenya. It is declared and paid by the transferor of the property.

· The rate of tax on Capital Gains 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.

· Payment should be initiated online via iTax.

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