On 22 January 2024, the Kenya Revenue Authority released a notice related to the market interest rate for fringe benefit tax purposes and the deemed interest rate for non-resident loans for January, February, and March 2024. The market interest rates and deemed interest rates have been raised from 13% to 15% for the previous three months.
The details of the notice are as follows:
Fringe benefit tax
For the purposes of Section 12B of the Income Tax Act, the Market Interest Rate is 15%. This rate shall be applicable for January, February and March 2024.
Deemed interest rate
For purposes of section 16(2) (ja) of the Income Tax Act, the prescribed interest rate is 15%. This rate shall be applicable for January, February and March 2024.
The withholding tax rate of 15% on the deemed interest shall be deducted and paid to the Commissioner within five working days following the computation.
Low interest benefit
For purposes of section 5(2A), the prescribed interest rate is 14%. This rate is applicable for January, February, March, April, May and June 2024.
