The Kenya Revenue Authority (KRA) has issued a public notice on revised market interest rates – lowered to 13% – for fringe benefit tax and deemed interest on certain non-resident loans for January to March 2025. It also sets the low-interest loan benefit rate at 14%, down from 16%, for January to June 2025.
Fringe benefit tax
For Section 12B of the Income Tax Act, the Market Interest Rate is 13%. This rate shall be applicable for January, February, and March 2025.
Deemed interest rate
For purposes of Section 16(2)(a) of the Income Tax Act, the prescribed interest rate is 13%. This rate is applicable for January, February, and March 2025.
The withholding tax rate of 15% on the deemed interest shall be deducted and paid to the Commissioner within five working days.
Low-interest benefit
For purposes of section 5(2A) of the Income Tax Act, the prescribed interest rate is 14%. This rate is applicable for January, February, March, April, May, and June 2025.
Earlier, the KRA had issued a public notice on the 16% market interest rate for fringe benefit tax and deemed interest on certain non-resident loans for October, November, and December 2024.
