Doing Business in Kenya - RSM International

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8.3 Payable FeesCompanies pay an initial fee to join any of the NSE’s markets and an annual feethereafter. If the company issues additional shares, it pays an additional listing fee.The table below provides the fees details.Initial Listing FeeMIMS AIMS FIMS0.6% of securities value to belisted, subject to a minimumof Shs 200,000 and amaximum of Shs 1,500,000.0.6% of securities marketcapitalisation, subject to aminimum of Shs 200,000 anda maximum of Shs 1,500,000.0.1% of the nominal ofthe additional securities,subject to a minimum of Shs500,000.0.06% of securities valueto be listed, subject to aminimum of Shs 100,000and a maximum of Shs1,000,000.Annual Listing Fee0.06% of securities marketcapitalisation, subject to aminimum of Shs 100,000and a maximum of Shs1,000,000.Additional Listing Fee0.1% of the nominal of theadditional securities, subjectto a minimum of Shs 25,000and a maximum of Shs250,000.0.0125% of the value of fixedincome securities (bonds) to belisted as follows:• A minimum of Shs 100,000and a maximum of Shs1,000,000 for corporatebonds and other fixedincome securities.• A minimum of Shs100,000 and a maximumof Shs 500,000 fortreasury bonds and otherGovernment securities.0.0125% of the market valueof outstanding fixed incomesecurities (bonds) listed asfollows:• A minimum of Shs 100,000and a maximum of Shs1,000,000 for corporatebonds and other fixedincome securities.• A minimum of Shs100,000 and a maximumof Shs 2,500,000 forTreasury bonds and otherGovernment securities.80DOING BUSINESS IN KENYA
8.4 Listing IncentivesFollowing are incentives available to the company wishing to list on the NSE:• No stamp duty payable on the share capital or increase in share capital of acompany listed on the Nairobi Stock Exchange.• Instruments executed pursuant to or in connection with issue of asset-backedsecurities approved by the CMA exempt from stamp duty.• All citizens of the East African Community Partner States who invest insecurities listed on the Nairobi Stock Exchange and earn dividend income aretreated the same as Kenyan residents and therefore pay withholding tax at 5%.• The Capital Markets Act has been amended to increase the percentage of theequity offer in an initial public offer that is reserved for Kenyans, from 25% to40%, and citizens of the other East African Community Partner States can alsoaccess this allocation.• Foreign investors can now acquire shares freely in the stock market subject to aminimum reserved ratio of 40% for domestic investors in each listed company.• Legal and other costs, including expenditure on rating, incurred on the issue ofshare or debentures (including listing without raising capital) to the public andlisting on a securities exchange in Kenya are corporate tax deductible;• Interest income received by an individual or a corporate from a listed bond witha maturity of at least 3 years used to raise funds for infrastructure or socialservices, and from interest income generated from cash flows and passed to theinvestors in the form of asset-backed securities is exempt from tax.• Investment ceiling by retirement benefits schemes in fixed income securities(e.g. bonds and commercial papers) has been raised from 15% to 30%.• To encourage savings, collective investment schemes set up by employers onbehalf of employees to invest in listed shares is exempted from income tax.• Newly listed companies pay a lower corporation tax of following the year oflisting as follows:• Lists at least 20% of its shares - 27% for 3yrs• Lists at least 30% of its shares - 25% for 5yrs• Lists at least 40% of its shares - 20% for 5yrs• Registered venture capital funds are accorded major tax incentives includingtax holidays of up to 10 years on the funds income.DOING BUSINESS IN KENYA81
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2.0 General2.1 IntroductionKenya li
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Kenya Tanzania Uganda Rwanda Burund
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A huge chunk of the Act regulates m
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• Stamping of the Memorandum of A
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the Registrar within a statutory pe
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3.2.3 Thin CapitalisationThin capit
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Where a business is carried on or e
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territory or domestic market. Motor
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• Unrealised foreign exchange los
Page 30 and 31: 4.2.6 Business with Non-Resident Pe
Page 32 and 33: Installments Due Date RateNon-Agric
Page 34 and 35: The current Personal Income Tax rat
Page 36 and 37: c) Housing• The higher of market
Page 38 and 39: partnership in which the husband or
Page 40 and 41: (1) East African Community partner
Page 42 and 43: Where the taxpayer still disputes w
Page 44 and 45: The VAT rates applicable in Kenya a
Page 46 and 47: 4.8.4 De-registration and Disposal
Page 48 and 49: • Payment is received for all or
Page 50 and 51: 4.8.7 Records, Invoices, Credit and
Page 52 and 53: A credit note should be serially nu
Page 54 and 55: However, where a motor vehicle or o
Page 56 and 57: Where there is no tax payable a ‘
Page 58 and 59: granted or is partly granted, the b
Page 60 and 61: • Airtime on cellular mobile phon
Page 62 and 63: Transit VisasThese are visas requir
Page 64 and 65: Class K is for persons who have an
Page 66 and 67: 5.3.2 WagesAlthough the Employment
Page 68 and 69: NSSF provides the employee with a l
Page 70 and 71: 6.0 ACCOUNTING6.1 Statutory Framewo
Page 72 and 73: 7.0 INTELLECTUAL PROPERTYRIGHTSKeny
Page 74 and 75: Years 1 Shs 1,000Year 2 Shs 1,500Ye
Page 76 and 77: 8.0 Listing Rules8.1 The Capital Ma
Page 78 and 79: • At the date of application, the
Page 82 and 83: 9.0 Investing in Kenya9.1 General I
Page 84 and 85: 9.3 Foreign Ownership of Shares and
Page 86 and 87: Contact Details - RSM AshvirRSM Ash
Page 88 and 89: Appendix of Acronyms used in the Bo
Page 90: Notes90DOING BUSINESS IN KENYA
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