Registering a foreign company's branch in Kenya
How a foreign company registers to do business in Kenya with form FC1, what KRA asks for before adding VAT, and the tax rate on a permanent establishment.
By Achekam · · 4 min read · For Running a business businesses in Kenya
A South African engineering firm wins a contract in Nairobi. A Ugandan distributor opens a Mombasa depot. A European NGO's trading arm starts selling services in Kenya. Each has a choice: set up a new Kenyan subsidiary, or register the existing foreign company to do business in Kenya as a branch.
The branch route keeps one legal entity, but it still means registering with the Business Registration Service, taking on Kenyan tax obligations and keeping Kenyan books. This article walks through the registration, the documents KRA asks for before VAT can be added, the tax rate that applies to a branch's profits, and a first-month checklist.
Form FC1 under section 975
The starting point is BRS's form FC1. BRS lists it as the application for registration of a foreign company under section 975 of the Companies Act, 2015.
You can download FC1 and see what each Companies Registry form is for on the BRS forms page, which lists the forms by number with the section of the Act each one relates to.
Before you fill it in, gather the parent company's constitutional documents and details of the people who will act for it in Kenya. Ask the registry early about any document that is not in English. The Companies Registry will tell you exactly what it needs alongside the form.
What the Companies Registry does
BRS explains that its Companies Registry administers three pieces of law: the Companies Act, 2015, the Registration of Business Names Act (Cap 499) and the Limited Liability Partnerships Act (No 42 of 2011). Its work includes registering companies, LLPs and business names, registering debentures and charges, and enforcing compliance.
For a foreign company, that means the same registry that holds Kenyan companies' records will hold the branch's registration. Charges over the branch's assets, if a lender takes security, are registered there too.
Tax set-up: the PIN and the VAT documents
Registration with BRS is not registration with KRA. The branch needs a KRA PIN, and the steps for a company are set out in getting a KRA PIN for a company.
If the branch will make taxable supplies, VAT follows. KRA says that before it approves adding a VAT obligation to a PIN, it requires documents including:
- the original CR12 for companies;
- identity documents for directors;
- a business permit;
- Tax Compliance Certificates for all directors;
- contract agreements or sample invoices.
KRA's list goes further for some applicants. It mentions work permits for aliens; a letter appointing a tax representative for non-resident companies; contact details such as a physical address, verified phone numbers, e-mail, utility meter numbers and an office rent agreement; and the supplier's website addresses where they apply.
Several of those items take time for a newly arrived branch: work permits, a lease, a utility account. Start them alongside the BRS registration rather than after it. Ask KRA early whether the tax representative letter applies to your branch. The full document list is discussed in documents KRA asks for with a VAT registration.
The tax rate for a permanent establishment
Whether a branch amounts to a permanent establishment is a question for your tax adviser, but where it does, the rate is set out plainly. The Income Tax Act, in the version published on Kenya Law, sets the rate for a non-resident company with a permanent establishment in Kenya at Sh. 6.00 in each twenty shillings, that is 30%, for the year of income 2024 and later years.
Be careful with older material. Some KRA pages still show the earlier 37.5% rate for non-resident companies. The Act governs; confirm the current rate with KRA or your adviser at the time you plan. For more on the branch rate and how it compares, see the tax rate on a non-resident's Kenyan branch.
Setting up the branch's books in Achekam
The branch needs its own Kenyan accounting records, separate from the parent's, so its Kenyan profit can be worked out and its returns prepared.
In Achekam, an organisation can sign up as a business rather than an accounting firm, choose its country, and get its own workspace, its own books and its own web address on the Achekam domain. The person who signs up becomes the administrator. Registering the workspace as Kenyan at sign-up makes the Kenya pack (KE_ICPAK_2026) the default and, when activated, sets the shilling (KES) and the Africa/Nairobi time zone unless they are already set.
One limitation to plan around: Achekam's ledger screens show every amount in rand, and the chart of accounts is stored in ZAR, even for a Kenyan business. Keep that in mind when you share ledger reports with head office or KRA, and label amounts clearly as shillings where it matters.
A first-month checklist
- Lodge form FC1 with BRS and keep the registration documents safe.
- Get the branch's KRA PIN.
- Start the slower items now: work permits, the office lease, utility accounts.
- Prepare the VAT documents if the branch will make taxable supplies, including any tax representative letter KRA requires.
- Agree the transfer arrangements with head office: how costs and services between them will be recorded.
- Open the branch's books as a Kenyan workspace, separate from the parent's.
- Diary the first deadlines: payroll, VAT and the annual return.
Lodge FC1 first, but start the work-permit and lease conversations the same week. Those are the steps that hold up everything else.
General guidance only, not advice on your own circumstances. Tax and payroll rules change: check the current position with the authority or your adviser.
