Kenyan instalment tax and the company return

When a Kenyan company's four instalment tax payments and its corporation tax return are due, how instalments are estimated, and what Achekam computes.

By Achekam · 11 October 2026 · 5 min read · For Accountants & audit firms in Kenya

Corporation tax in Kenya is not paid once a year. A company pays during the year in instalments, then files its return and settles up after the year end. Miss an instalment date and the company is in arrears before its year has even closed; get the estimate wrong and the shortfall surfaces months later.

For a firm looking after many Kenyan companies, each with its own year end, the dates multiply quickly. This article sets out when instalments and the return are due, how each instalment is estimated, and where Achekam helps and where it does not yet compute anything.

Four instalments in the year

Kenyan resident companies, and non-resident companies with a permanent establishment, pay corporation tax at 30%, with special regimes for some entities such as export processing zone and special economic zone companies. Companies use their own 12-month year, so the dates below run from each company's own year start, not from the calendar.

Instalment tax is due on the 20th day of the 4th, 6th, 9th and 12th months of the company's year. Two examples, worked in words:

The fourth instalment falls in the last month of the year itself, so the company has paid its estimated tax in full before the books close. From 1 July 2026, individuals whose only income is employment income are exempt from instalment tax, which affects individual clients but not companies.

Last year's tax or this year's estimate

Each year's instalments are based on the lower of two amounts: 110% of the previous year's tax, or the estimate of the current year's tax.

That choice is a real planning decision:

• A growing company will usually find that 110% of last year's tax is the lower amount, and it gives certainty: the figure is known on the first day of the year.
• A company whose profits are falling may pay less by estimating the current year, but the estimate must be defensible, and it should be revisited before each instalment as management accounts come in.

Write down which basis was used for each client and why, and keep the estimate with the working papers. KRA's page on instalment tax sets out who pays it, the prior-year and current-year methods for estimating it, and the four due dates.

The return six months after year end

A Kenyan corporation tax return is due within 6 months after the year end. For a 31 December company, that means by 30 June; for a 30 June company, by 31 December. The return reconciles the instalments already paid with the tax actually due for the year.

Build the season around the return dates, and treat the fourth instalment as a checkpoint. If the year's results are clear by then, a revised estimate can bring the final instalment closer to the actual liability.

Computed once the rules are approved

Achekam's Revenue Service Centre has a Kenyan side. Staff can open a Kenyan tax profile for a client or the firm and start returns that move through prepare, review and approve by different people. Once its rules are approved, Achekam computes Kenyan corporation tax and instalment tax, alongside VAT, withholding tax, turnover tax, capital gains tax and stamp duty.

The condition matters. Every Kenyan tax figure in Achekam's rule book was seeded "under review", and Achekam computes nothing from a figure until an Achekam platform administrator approves it. No firm user can change a rate. Check in your workspace whether the rules are approved before relying on a computed instalment.

Two other points:

• Kenyan rules whose start date the research did not find begin on 1 January 2026 in Achekam, so earlier Kenyan periods are refused rather than computed.
• Achekam's filing calendar leaves out any deadline whose rule is awaiting approval or contested, and says why. Until the rules are approved, keep your own list of instalment and return dates for each client.

Paying with a PRN

Kenyan tax is paid with the payment registration number from an iTax payment slip, at a bank or by M-Pesa to the government paybill 222222 with the PRN as the account number. Paybill 572572 is discontinued. Mobile money is limited to KES 250,000 per PRN, a limit worth re-checking before relying on it.

Achekam records the payment with KRA's own reference and receipt, never generates a payment reference, refuses the discontinued paybill, and needs a second person to confirm the payment. The confirmer should compare the PRN on the iTax slip, the PRN and amount on the bank receipt or M-Pesa message, and what was recorded, because one wrong digit can leave an instalment unallocated on KRA's side while the client believes it has paid.

Generate a fresh slip for each instalment. A PRN belongs to one payment; reusing an old one, or paying the right amount against the wrong period, creates exactly the kind of mismatch that surfaces later as a demand. For a company whose clients deduct tax from its fees, see withholding tax on fees paid to Kenyan firms, and for loss-making clients, Kenya's minimum tax after the court rulings.

When the estimate turns out wrong

Estimates drift. A contract is lost in the third quarter, or an unexpected gain lands in the last month. Late or short payment of tax attracts penalties and interest in Kenya, so the cheapest moment to correct an estimate is before the next instalment, not at the return. Keep a short note at each instalment date recording the figure used, the information it rested on and who agreed it with the client. If a later demand arrives, that note is the firm's evidence that the estimate was reasonable when it was made.

A calendar per client

For each Kenyan company client, write down the year end, the four instalment dates, the return date and the estimation basis chosen. Set reminders a fortnight before each instalment, review the estimate at each one, and record each PRN payment with its receipt when it is made.

General guidance only, not advice on your own circumstances. Tax and payroll rules change: check the current position with the authority or your adviser.