The Government of Kenya has published a draft bill targeting remote workers in the new Tax Procedures (Amendment) (N0. 2) Bill, 2024, seeking to amend several tax laws.
One of these major changes is the introduction of a new law requiring everyone working remotely for a Kenyan employer to register with the Kenya Revenue Authority (KRA).
This is of course with the exemption of those working for the national carrier Kenya Airways outside the country.
“To require for registration of an employee working remotely outside Kenya for an employer in Kenya, excluding an employee outside Kenya working for the national carrier,” part of the draft of the bill reads.
If passed, the bill will amend the First Schedule of the Tax Procedures Act to add this new requirement for obtaining a Personal Identification Number (PIN) for all employees working remotely for a Kenyan company regardless of their location.
It will not only bring remote workers living outside Kenya into the tax compliance framework but will also ensure that the KRA can account for tax liabilities and collections from income earned through such employment arrangements, regardless of the employee's location.
This new bill comes just a month after President William Ruto introduced a Digital Nomad Visa to open up the country’s tourism sector to world travellers who work remotely.
While launching the work permit, Ruto stated, "The visa is specifically designed to welcome global digital professionals, allowing them to live and work in Kenya while enjoying the country’s natural beauty and high-quality lifestyle.”
It is also part of a larger strategy to increase foreign investment, employment, and tourism.
To be eligible for the digital nomad work permit, one would need to have a valid passport, proof of a remote job outside Kenya, proof of accommodation within Kenya, and a clean criminal record.
In order to attract tourists bringing in more revenue from tourism, eligible persons will need a minimum annual income of $53,922 (Approximately Ksh7 million).
The introduction of this new tax amendment bill is targeting Kenyans who have decided to take this route and work remotely outside the country while still working for Kenyan employers.
