The Hidden Costs of Land Ownership in Kenya — What Taxes You Should Know (and Avoid Penalties)

Owning land in Kenya is a powerful investment — but many landowners overlook a critical aspect: taxes.

Whether you’re buying, selling, or leasing land, understanding your tax obligations is essential to staying compliant, avoiding delays, and keeping your property transactions stress-free.

Here’s a practical breakdown of land-related taxes in Kenya and how Accotax Consultancy can help you stay on the right side of the law.

1. Land Rates

What it is: A fee charged annually by your County Government for owning land in urban or peri-urban areas.

• Who pays: Landowners (freehold or leasehold)
• Why it matters: Required for any sale, lease, development approval, or title transfer.
• Where to pay: County revenue offices or their online portals.

Nairobi County Land Rates Info

Tip: Delays lead to penalties. Always request a Rates Clearance Certificate before transactions.

2. Land Rent

What it is: A government charge for leasehold land — especially land leased for 33, 50, or 99 years.

• Who pays: Owners of leasehold land (not freehold)
• Where to pay: Ministry of Lands at Ardhi House or eCitizen
• Why it matters: You need a Land Rent Clearance Certificate for transfers or renewals.

Pro tip: Use your title deed number to check your land rent status online.

3. Capital Gains Tax (CGT)

What it is: A tax on profit earned when selling land.

• Rate: 15% on net gains
• Who pays: The seller
• Filed via: KRA iTax
• Exemptions: Transfers to spouses, inheritance, and low-value transfers

Plan ahead: Many people forget CGT until it’s too late, delaying transactions.

4. Stamp Duty

What it is: A one-time tax paid during land title transfers.

• Urban properties: 4% of property value
• Rural/agricultural land: 2%
• Who pays: Usually the buyer (but can be negotiated)
• Why it matters: Paid before the land can be registered in your name.

KRA Stamp Duty Info

5. Rental Income Tax (For Leased Land)

What it is: A tax on income earned from leasing land or rental property.

• Residential: 10% of gross rent (under Monthly Rental Income regime)
• Commercial: Taxed as business income
• Filing: Monthly on KRA iTax

⚠️ Non-compliance attracts interest and audit risks.

How Accotax Can Help

We handle:

• Land rent & rates verification
• CGT calculation & filing
• Stamp duty guidance
• Rental income filing
• Full land transfer support

📞 Contact Accotax:
✉️ info@accotax.co.ke
📍 Nairobi | Mombasa | Kisumu
🌐 www.accotax.co.ke