How to File Taxes for Your Investment Group

Most chamas don't think about taxes. But if your group earns investment income — interest, dividends, rental income, or capital gains — KRA may have questions.

When Taxes Apply

Withholding Tax (Automatic)

• Bank interest: 15% withheld at source
• T-Bill/Bond interest: 15% withheld
• Dividends: 5% withheld
• You don't need to do anything — the institution deducts before paying you

Rental Income Tax

• If your chama owns rental property earning over KES 288,000/year: you need to file and pay residential rental income tax (10% of gross rent)
• Register for a KRA PIN in the group's name

Capital Gains Tax

• Selling property (land, buildings): 15% on the gain (sale price minus purchase price)
• Selling shares: 5% capital gains tax (proposed, check current rates)

Getting a Group KRA PIN

1. Register on iTax (itax.kra.go.ke)
2. Select 'Partnership' or 'Other' as entity type
3. Provide: group registration certificate, constitution, officials' IDs
4. Receive KRA PIN
5. File annual nil returns (even if no tax is due)

Practical Advice

For most small chamas earning only interest and dividends, withholding tax at source covers your obligations. You don't need to file separately unless you have rental or business income.