This article focuses on how to pay Digital Service Tax in Kenya. Digital Service Tax (DST) is payable on income derived or accrued in Kenya from services offered through a digital marketplace. The return and payment with respect to DST is due on or before the 20th day following the end of the month the digital service was offered.
How To Pay Digital Service Tax
Digital Service Tax due will be paid in Kenyan currency and deposited into the KRA account of the authorized Kenyan banks.
DST is paid by resident and non-resident digital service providers, digital marketplace providers or their appointed tax representatives (in the case of non-residents or providers without a permanent establishment in Kenya).
Rate of Digital Service Tax
1.5% of the gross transaction value;
- In the case of the provision of digital services, the payment received as consideration for the services.
- In the case of a digital marketplace, the commission or fee paid to the digital marketplace provider for the use of the platform.
The gross transaction value is exclusive of VAT.
Taxable Services Under Digital Service Tax Regulations
- Downloadable digital content including downloadable mobile applications, e-books and films.
- Streaming television shows, films, music, podcasts and any form of digital content.
- Sale of, licensing of, or any other form of monetising data collected about Kenyan users which have been generated from the users’ activities on a digital marketplace.
- Provision of a digital marketplace.
- Subscription-based media including news, magazines and journals.
- Electronic data management including website hosting, online data warehousing, file-sharing and cloud storage services.
- Electronic booking or electronic ticketing services including the online sale of tickets.
- Provision of search engine and automated held desk services including supply of customised search engine services.
- Online distance training through pre-recorded media or e-learning including online courses and training.
- Any other relevant services provided through a digital marketplace.