20 March 2026
Capital Gains Tax Kenya 2026: What NSE Investors Need to Know
If you are wondering about capital gains tax in Kenya on NSE shares — the answer is zero. Capital gains tax on profits from selling NSE-listed shares is currently suspended at 0% and has been since July 2015. This guide explains exactly what tax Kenyan investors do and do not pay in 2026, and what to watch for in future budgets.
There is currently no capital gains tax on profits from selling NSE-listed shares in Kenya.
This is one of the most searched financial questions among new Kenyan investors — and one of the least clearly answered. This guide gives you the complete, verified picture for 2026.
Capital Gains Tax Kenya 2026 — The Direct Answer
Capital gains tax on NSE shares in Kenya: 0%
When you buy Safaricom shares at KES 15 and sell them at KES 20, your KES 5 profit per share is entirely yours. You do not pay capital gains tax on this profit. You do not need to report it to KRA. You do not file any additional return.
This exemption covers all shares listed on the Nairobi Securities Exchange — Safaricom, KCB, Equity, EABL, Standard Chartered, Co-operative Bank, and every other NSE-listed company.
Capital Gains Tax Kenya: Why It Was Suspended in 2015
Kenya originally introduced a Capital Gains Tax at 5% in January 2015. It was suspended just six months later in July 2015 after significant pushback from the NSE and investment community who argued it would reduce market activity and liquidity.
Since the 2015 suspension, no capital gains tax has applied to NSE share transactions. As at March 2026, the suspension remains in effect.
Should investors worry about future reintroduction? Capital gains tax has been discussed in Kenyan budget circles periodically. Any reintroduction would require an act of Parliament and would typically be announced during the annual budget in June. Monitor the Finance Bill each year for proposed changes.
What Tax Do NSE Investors Actually Pay?
While capital gains are tax-free, two other taxes apply to NSE investors:
1. Dividend withholding tax — 5% for residents Every dividend you receive from an NSE-listed company has 5% automatically deducted before payment. This is a final tax — no filing required. If KCB declares KES 7.00 dividend per share, you receive KES 6.65 net after the 5% deduction.
This is NOT capital gains tax. It is a tax on income (the dividend), not on your profit from selling shares.
2. Stamp duty on share purchases — 0.1% When you buy NSE shares, 0.1% stamp duty is applied to the purchase value. On KES 10,000 of shares purchased, stamp duty is KES 10. This is included in your broker’s total transaction cost automatically.
Complete Tax Summary for NSE Investors
Capital gains tax Kenya 2026 — complete tax summary for NSE investors.
| Tax | Rate | When applies | Filing required |
|---|---|---|---|
| Capital gains tax | 0% | Never — currently suspended | No |
| Dividend withholding tax | 5% (residents) | When you receive dividends | No — deducted automatically |
| Stamp duty | 0.1% | When you buy shares | No — included in broker costs |
| Income tax on dividends | 0% additional | Never — WHT is final tax | No |
The bottom line for most retail NSE investors: You pay 5% on dividends received (automatically deducted), 0.1% on purchases (automatically included in broker costs), and nothing on profits from selling shares.
Record Keeping — What to Keep Even Without CGT
Even without capital gains tax, keep records of your NSE transactions for:
Proof of investment for loan applications: Banks and SACCOs may ask for your investment portfolio as evidence of net worth or collateral.
Dividend reconciliation: If your dividend payment does not arrive or the amount seems wrong, broker trade confirmations and CDS statements help trace the issue.
Future CGT if law changes: If capital gains tax is reintroduced, your historical purchase prices (cost basis) will determine your taxable gain. Keep all trade confirmations permanently.
How to access your records: Your stockbroker provides annual transaction statements. Your CDS account at cdsckenya.com shows your complete shareholding history. Download and save these annually.
How This Compares to Other Investments
Capital gains tax Kenya compared to other investment tax rates.
| Investment | Capital gain tax | Income tax | Total tax picture |
|---|---|---|---|
| NSE shares | 0% | 5% WHT on dividends | Very favourable |
| Property | 5% CGT | 10–30% rental income tax | Higher |
| Business income | Not applicable | 15–30% corporate/personal | Much higher |
| Money market fund returns | 0% | 15% WHT on interest | Higher than dividends |
| Treasury Bills | 0% | 15% WHT on interest | Higher than dividends |
NSE shares carry the most favourable tax treatment of any investment category in Kenya — 0% on capital gains and only 5% on dividend income. This is a significant advantage that most Kenyan investors do not fully appreciate.
FAQ
Is there capital gains tax in Kenya on NSE shares in 2026?
No. Capital gains tax on NSE-listed shares is currently suspended at 0%. Your entire profit from selling shares is tax-free. This has been the case since July 2015.
Do I need to declare NSE share profits to KRA?
No. With capital gains tax suspended, there is no requirement to declare share sale profits in your KRA return. The only NSE-related item that affects your tax return is dividend income — but since withholding tax is deducted automatically by the company, even dividends require no separate filing.
Is capital gains tax coming back in Kenya?
As at March 2026, it remains suspended. Any reintroduction would be announced in the annual Finance Bill typically released in April–May ahead of the June budget. Monitor the 2026 Finance Bill for any proposed changes.
What is the withholding tax rate on NSE dividends?
5% for Kenyan resident individuals. 15% for non-residents. Deducted automatically before payment — you receive the net amount without any action required.
Does buying and selling NSE shares require KRA PIN?
Yes — your CDS account is linked to your KRA PIN when opened. You need a KRA PIN to open a CDS account and start investing. See our KRA PIN Kenya 2026 guide for how to apply free in five minutes, and our How to Invest in NSE Kenya 2026 guide for the complete CDS account opening process.
Tax laws change with each annual Finance Bill. Verify the current capital gains tax position at kra.go.ke or through a licensed tax advisor before making investment decisions based on tax treatment. Last updated March 2026.