Crypto Tax in Kenya: What KRA Expects from You

Crypto tax in Kenya comes down to three questions, and KRAKRAKenya Revenue Authority, the tax collector. It administers the excise duty on crypto platform fees and income tax rules. Glossary has answered only some of them. Is there a tax every time you buy or sell? (Not any more.) Is there a tax on the platform’s fee? (Yes, 10% excise duty since 1 July 2025.) And is your profit taxable income? (Often yes, but the law is less clear than KRA’s critics or fans suggest.) This guide takes them one at a time, with worked examples in shillings.

This is general information, not tax advice. Tax depends on your circumstances; for anything beyond small amounts, speak to a registered tax agent or KRA directly.

How Kenya’s crypto tax rules changed

Kenya tried two very different models in quick succession. First it taxed the value of every crypto transfer; then it switched to taxing the fees platforms earn.

• 1 September 2023Digital Asset Tax beginsFinance Act 2023: 3% of the value of a crypto transfer or exchange, withheld by the platform or facilitator and paid to KRA.
• Sep 2023 – Jun 2025About KSh 1.1 billion collectedBusiness Daily reported this DAT total for the life of the tax.
• 1 July 2025DAT repealed, excise on feesFinance Act 2025: the 3% DAT is removed and a 10% excise duty applies to fees charged on virtual asset transactions by virtual asset providers.
• 4 November 2025VASP Act commencesLicensing of platforms begins under the Virtual Asset Service Providers Act 2025; licensed platforms are easier for KRA to supervise.
• Finance Act 2026Virtual asset reportingNew sections 6C and 6D of the Tax Procedures Act add virtual asset reporting obligations, according to PwC's summary.

Why did the DAT go? Because it taxed turnover, not profit. Sell KSh 100,000 of USDT at a loss and you still paid KSh 3,000. The Finance Bill 2025 first proposed cutting it to 1.5%; Parliament instead removed it and moved to the excise model.

The 10% excise duty: who pays and how much

KRA’s public notice on the Finance Act 2025 lists the new excisable service in plain words: “fees charged on virtual assets transactions by virtual asset providers”, at 10% of the excisable value, effective 1 July 2025. Suppliers of excisable services must register, charge the duty and remit it to KRA.

In other words, the platform owes the duty. Whether you see it depends on how the platform prices it: some add it on top of the fee, some absorb it inside the fee. Ask the platform if your statement does not show it.

Here are worked examples. The fee levels are illustrative; check each platform’s own fee page.

Note the last row. On P2P markets the buyer usually pays no platform fee, so there is nothing for excise to attach to. Your real P2P cost is the seller’s markupMarkupExtra margin added on top of the market rate by a broker or P2P seller. It is a fee even when the app says "zero fees". Glossary plus the Safaricom tariff — see our M-Pesa charges calculator. M-Pesa fees themselves are not crypto fees; they carry their own excise under separate rules.

Is crypto profit taxable income?

This is where the honest answer is “it depends”. The Income Tax Act taxes income from business, employment, rent, dividends and more, earned in or derived from Kenya. It does not have a crypto chapter, and KRA has not published a crypto guide for individuals that we could find.

How the general rules are likely to apply:

• Paid in crypto for work. Freelancers, remote workers and online sellers paid in USDT have taxable income, exactly as if paid in shillings. Record the KES value on the day you receive it. See receiving USDT payments in Kenya.
• Trading as a business. If you trade often, use leverage, run P2P arbitrage or act as a P2P merchant, your profits look like business income, taxed at the normal individual bands.
• Occasional buy-and-hold. Buying Bitcoin once and selling years later is closer to a capital transaction. Kenya’s capital gains tax is 15% of the net gain, but KRA describes it as a tax on the transfer of “property situated in Kenya”. Whether a coin held on a foreign exchange or in a phone wallet is “situated in Kenya” has not been settled.

These are KRA’s individual bands effective from 1 July 2023, with a personal relief of KSh 28,800 a year for residents.

Illustration only. Suppose your trading profit for the year is KSh 300,000 after fees and you have no other income. If KRA treats it as business income: 10% of the first 288,000 is KSh 28,800, plus 25% of the remaining 12,000 is KSh 3,000 — total KSh 31,800, less personal relief of KSh 28,800, leaves KSh 3,000. If you are also employed, the profit stacks on top of your salary and is taxed at your marginal rate, often 30%.

Kenya crypto tax rumours, checked

Crypto tax is a favourite WhatsApp topic. Here are the claims we hear most, with what the law and KRA’s own pages actually say.

A simple record-keeping template

Good records cost you five minutes a week and can save you weeks of stress. Keep a spreadsheet (or a notebook) with one row per transaction.

Rates above are examples, not current prices. Use the rate you actually got; for transfers you receive, a published market rate on that day is reasonable — write down the source. Our USDT to KES converter shows the live rate, and for a cash-out, the P2P order screen in our Binance to M-Pesa guide shows the rate you actually received.

• Download your exchange trade history as CSV every month — some platforms only keep a limited window online.
• Save the M-Pesa confirmation code next to each P2P order ID.
• Record the TXID (transaction ID) of every on-chain transfer so you can show it moved between your own wallets.
• Note transfers between your own accounts as transfers, not sales.
• Keep records for at least five years, the general record-keeping period under Kenya's Tax Procedures Act.

Declaring crypto income on iTax

If your crypto activity produces income, it goes in your normal annual return. The form you use depends on your sources of income.

1. Work out the year's figures in KES

   Total your crypto income (payments received, trading profit) for the calendar year, using your records. Subtract fees and allowable costs only where you have evidence.

2. Log in to iTax with your KRA PIN

   Go to itax.kra.go.ke, choose Returns → File Return, and select Income Tax – Resident Individual. If you only have a salary, the simplified form is not enough once you add business income.

3. Declare it as business or other income

   Freelance and trading income go in the business income sections. Attach or keep your workings; KRA can ask for them later.

4. Pay before 30 June

   Returns are due between 1 January and 30 June of the following year. Pay any balance through the KRA Paybill on M-Pesa or your bank, using the payment slip iTax generates.

What we could not confirm

We checked KRA’s website, Finance Act notices and the VASP Act, but some answers are not public yet:

• Any KRA guidance specifically on how individuals’ crypto gains are classified.
• Whether capital gains tax applies to crypto held offshore or in self-custody.
• The detailed scope of the Finance Act 2026 virtual asset reporting sections and when KRA will start using them.

When KRA publishes clearer guidance, we will update this page. Until then, the safest habit is the boring one: keep records, declare income you clearly earned, and do not rely on rumours.