Title What is qualifying interest and how does the recent amendment to the income tax affect qualifying interest?
Description

Qualifying interest is interest on income receivable by resident individuals from banks, buildings, societies or Central Bank of Kenya which are subjected to withholding tax (WHT) at source which is a final tax. This means prior to the new amendments, interest arising from other sources different from the above mentioned were not categorized as qualifying and hence, WHT thereon was not final.


With the new amendments, interest from whatever source receivable by resident individuals are now qualifying. Consequently, WHT charged is final.


The amendments are aimed at encouraging individuals to save in other institutions other than banks, building societies or CBK.  
Category Tax Laws (Amendment) Act 2020