Kuwait

Kuwait does not impose corporate income tax (CIT) on companies wholly owned by the nationals of Kuwait or other Gulf Cooperation Council (GCC) countries (Bahrain, Oman, Qatar, Saudi Arabia, and the United Arab Emirates). However, GCC companies with foreign ownership are subject to taxation to the extent of the foreign ownership. CIT is imposed only on the profits and capital gains of foreign 'corporate bodies' conducting business or trade in Kuwait, directly or through an agent.

Income earned from activities in Kuwait shall be considered subject to tax in Kuwait on the basis that it is Kuwait-sourced income. In cases where a contract involves the performance of work both inside and outside Kuwait, the entire revenue from the contract must be reported for tax in Kuwait, including the work carried out outside Kuwait. Please refer to the Income determination section for more information on income that is subject to tax in Kuwait.

The current CIT rate in Kuwait is a flat rate of 15%.

Foreign companies carrying on trade or business in the offshore area of the partitioned neutral zone under the control and administration of Saudi Arabia are only subject to tax in Kuwait on 50% of their taxable profit under the law.

Please see the Withholding taxes section for the description of the 5% tax retention requirement.

Domestic Minimum Top-up Tax (DMTT)

The Pillar Two rules require large multinational enterprises (MNEs) to pay a minimum effective tax rate of 15% on profits in every country where they operate. The Kuwait DMTT will apply to MNEs operating in Kuwait with consolidated global revenues of 750 million euros (EUR) or more in at least two out of the four financial years immediately preceding the financial year in which the DMTT applies. Kuwait’s implementation of the DMTT will closely align with the OECD’s Global Anti-Base Erosion (GloBE) Model Rules.

The specific details on the Kuwait DMTT implementation, including provisions, conditions, rules, controls, and procedures will be covered in the Executive Regulations, which are required to be issued by 30 June 2025.

For more detailed information and the most recent updates, please visit PwC’s Pillar Two Country Tracker.

Zakat

Zakat is imposed on all publicly traded and closed Kuwaiti shareholding companies at a rate of 1% of the companies’ net profits.

Contribution to the Kuwait Foundation for the Advancement of Sciences (KFAS)

All Kuwaiti shareholding companies are required to pay 1% of their net profits as per their financial statements, after transfer to the statutory reserve and the offset of losses carried forward, to the KFAS, which supports scientific progress.