Tax Implications for Kenyan traders

Many Kenyan forex traders are not sure what their legal tax obligations are towards the Kenyan Revenue Authority (KRA). Many trading accounts are overseas, and the gains made from their trading are not visible to the KRA. Some traders open trading accounts with Forex brokers located in Kenya, or with brokers who have branches in Kenya. In this case, these traders’ capital won’t leave the country.

Trader Must Pay Tax On Earnings

In Kenya, all profits from Forex trading are classified as Capital Gains. It is a common misperception that traders don’t need to pay income tax on profits made in offshore trading accounts. If a Kenyan resident generates profit from trading in an offshore trading account while residing within the borders of Kenya, the profit is regarded as normal taxable income and needs to be declared in their tax returns. In this case, it doesn’t matter where the income originates from, but rather where the person resides while generating that income. 

This article is a general guide only and is not intended as individual legal tax advice. For more specific information on Kenyan tax legislation please consult a registered tax practitioner or the Kenyan Revenue Authority.