Kenya-incorporated companies are treated as Kenyan-tax resident. Additionally, companies incorporated overseas are also treated as Kenya resident if their ‘management and control is exercised in Kenya in a particular year of income under consideration’. A company may also be declared a tax resident in Kenya pursuant to a declaration in a legal notice by the Cabinet Secretary for the National Treasury.
A business carried on in Kenya through a fixed place of business gives rise to a Permanent Establishment (PE), as does a building site, or a construction or assembly project, that has existed for six months or more.
The definition of a PE is extended to include a dependent agent that habitually concludes contracts on behalf of others.