Kenyan tax years for companies, staff and government
How the calendar year, a company's own year and the government's July year run side by side in Kenya, and which deadlines each one drives.
By Achekam · · 4 min read · For Running a business businesses in Kenya
A Kenyan company with a March year end lives by three clocks at once. Its staff are taxed on the calendar year. The company itself is taxed on its own April-to-March year. And the government's budget, with the Finance Act that comes with it, runs from July to June. None of the three lines up with the others.
Most of the confusion in small finance teams comes from mixing them up: running a "year-to-date" PAYE report from the company's year start, or counting instalment months from January for a company whose year starts in April. This article separates the three years, shows which deadlines hang off each, and works through one company's dates in full.
Employees: the calendar year
In Kenya, the individual tax year is the calendar year, 1 January to 31 December. Everything about an employee's annual tax follows it:
- PAYE is deducted and paid monthly, with the P10 filed and paid by the 9th of the following month, so each month's payroll belongs to the calendar year it was earned in.
- The P9A you give each employee covers January to December.
- The employee's individual return for the year is due by 30 June of the following year. From 1 January 2027 that moves to 30 April, first for the 2026 year of income.
So even a company whose own year ends in June must close off its payroll year in December. Getting the P9As right depends on it; see giving Kenyan staff their P9A.
Companies: their own 12-month year
Kenyan companies use their own 12-month year, which may end in any month. The company's corporation tax is worked out on that year, and its return is due within 6 months after the year end.
Choosing or changing a year end is a decision to take with your accountant. Once chosen, it sets the rhythm for the company's tax: the instalments, the return and the payment of any balance. Every date that follows from it, month by month, is in a Kenyan business's tax calendar.
The government's July to June year
The government's financial year runs from 1 July to 30 June. It is the year of the national budget, and Finance Act changes are often timed from it. A current example: from 1 July 2026, individuals with employment income only are exempt from instalment tax.
You do not file anything on the government's year. You watch it, because a change announced for the new fiscal year can take effect partway through your own company year or your employees' calendar year. The Income Tax Act, consolidated on Kenya Law, is the law behind corporation tax, PAYE, withholding tax, turnover tax, instalment tax and allowable deductions; each Finance Act amends it, so check the consolidated text when a change lands.
Instalments counted from your year start
Instalment tax is due on the 20th day of the 4th, 6th, 9th and 12th months of the company's year, based on the lower of 110% of the previous year's tax or the tax on this year's estimate. The months are counted from the company's own year start. That is where mixing up the clocks costs money, because counting from January puts every instalment on the wrong date for a company whose year starts any other month. The method of working out each payment is in paying Kenyan instalment tax on time.
One company's dates, worked through
Take a company whose financial year runs from 1 April 2026 to 31 March 2027:
| Clock | What falls due | When |
|---|---|---|
| Company year, month 4 | First instalment | 20 July 2026 |
| Company year, month 6 | Second instalment | 20 September 2026 |
| Company year, month 9 | Third instalment | 20 December 2026 |
| Company year, month 12 | Fourth instalment | 20 March 2027 |
| Company year end plus 6 months | Corporation tax return | By 30 September 2027 |
| Calendar year 2026 | Staff P9As cover January to December 2026 | Issued early in 2027 |
| Calendar year 2026 | Employees' individual returns | By 30 April 2027 |
| Government year 2026/27 | Budget and Finance Act measures | From 1 July 2026 |
| Every month | P10 for the previous month's payroll | By the 9th |
Notice that December 2026 brings both the third instalment and the end of the payroll year, and that the return for the company's year is due months after the staff returns for the calendar year that overlaps it.
Year-to-date reports that start in January
Achekam's management accounts give you an income statement for a chosen period beside the period before, and a balance sheet at period end. The year-to-date preset starts on 1 January, not on the business's own year start.
For payroll and the employees' calendar year, that preset is exactly right. For a company with an April or July year, it is not: choose your own start and end dates when you want the company's year to date, or the comparison will mix two financial years.
A short check for your finance calendar
- Write down your company's year start and year end.
- Count the 4th, 6th, 9th and 12th months from the year start, and enter the 20th of each.
- Enter the return deadline, 6 months after the year end.
- Enter 31 December as the payroll year end, and a date early in January to issue P9As.
- Enter 30 April for the employees' returns from 2027.
- Enter 1 July as the date to review what the new Finance Act changed.
Three clocks are manageable once each one has its own line in the calendar. The trouble only starts when one of them is assumed to be another.
General guidance only, not advice on your own circumstances. Tax and payroll rules change: check the current position with the authority or your adviser.
