Stamp Duty in Kenya 2025: How It Works and How to Budget
Introduction
When buying property in Kenya, one of the biggest hidden costs buyers overlook is stamp duty. In 2025, stamp duty in Kenya remains a mandatory property tax charged on land and property transfers. Whether you’re buying a home, plot, or apartment, it’s essential to plan for this cost upfront. This guide explains how stamp duty in Kenya 2025 works, the rates you’ll pay, exemptions available, and budgeting tips for smooth transactions.
What is Stamp Duty?
Stamp duty is a tax levied on legal documents involved in the transfer of property ownership. In Kenya, it is payable to the Kenya Revenue Authority (KRA) before the transfer of title can be completed.
Without stamp duty payment, you cannot legally register property ownership.
Stamp Duty Rates in Kenya (2025)
- Urban areas (Nairobi, Mombasa, Kisumu, Nakuru, etc.): 4% of the property value
- Rural areas: 2% of the property value
Example: If you buy an apartment worth KES 10 million in Kilimani, Nairobi, you’ll pay 4% = KES 400,000 in stamp duty.
Exemptions and Discounts
Certain transactions may qualify for exemptions or reduced rates:
- First-time homebuyers: The government has previously introduced reliefs, check latest Finance Act updates.
- Spousal transfers: No duty if property is transferred between spouses.
- Corporate restructuring: Exemptions may apply under special approval.
Always confirm exemptions with KRA or your lawyer before budgeting.
Other Property Taxes in Kenya
Aside from stamp duty, buyers should also plan for:
- Capital Gains Tax (CGT): Paid by sellers at 15% of net gain.
- Legal fees: Typically 1%–2% of purchase price.
- Valuation fees: Charged by government valuers for assessing market value.
See our related guide: Legal Considerations in Real Estate »
How to Pay Stamp Duty in Kenya
- Valuation: Submit the sale agreement for valuation by government valuers.
- Assessment: KRA assesses the property and calculates stamp duty.
- Payment: Pay via iTax or through your lawyer’s client account.
- Approval: Once paid, the transfer is registered at the land registry.
Common Mistakes to Avoid
- Underestimating costs — always include stamp duty in your budget.
- Ignoring location differences (urban vs. rural rate).
- Depending solely on verbal agreements — ensure valuation and assessment are documented.
- Delaying payment, which can slow down property transfer.
Budgeting Tips for Buyers
- Factor in 4% on top of property price when setting your budget in Nairobi.
- Keep extra 1%–2% for legal and valuation fees.
- Use professional lawyers or conveyancers to avoid errors.
Frequently Asked Questions
Is stamp duty in Kenya refundable?
No, once paid, stamp duty is non-refundable.
Who pays stamp duty, buyer or seller?
The buyer always pays stamp duty.
When is stamp duty due?
Before registration of property transfer at the land registry.
Can stamp duty be included in a mortgage?
Some banks allow this, but usually it must be paid upfront.
Final Thoughts
Understanding stamp duty in Kenya 2025 is critical for any property purchase. It is not just a legal requirement but a cost that can significantly affect your budget. By planning ahead and seeking professional advice, you can avoid surprises and ensure smooth ownership transfer.
At Sarabi Realty Group, we help clients navigate property taxes, legal compliance, and safe investments in Nairobi and across Kenya.
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