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Kenya lease stamp duty: what the Act says against the versions that circulate

Stamp duty on a lease in Kenya is set by item 21 of the Schedule to the Stamp Duty Act (Cap. 480). In round numbers: about 1% of the total rent for a lease of up to one year, 1% of one year’s rent for a term of one to three years, and 2% of one year’s rent for anything longer or for an indefinite term. The lessee pays. The Act makes no distinction between residential and commercial leases, between towns and rural areas, or between citizens and foreigners. Several other versions of the rate circulate in guides and template notes; none of them matches the Act.

Checked: 31 October 2026, against the official sources belowJurisdiction: KenyaLicence: CC BY 4.0How to cite

Who says what

What the Act says

Term of the leaseDutyBaseRoughly
Definite term not exceeding one yearKES 20 for the first KES 2,000, plus KES 10 per KES 1,000 or part above thatThe whole amount payable under the lease1% of total rent
Definite term of not less than one year and not more than three yearsKES 5 per KES 500 (rent up to KES 2,000 a year); KES 10 per KES 1,000 or part (rent above KES 2,000 a year)The rent at a rate or average rate per year1% of annual rent
Any longer definite term, or an indefinite termKES 10 per KES 500 (rent up to KES 2,000 a year); KES 20 per KES 1,000 or part (rent above KES 2,000 a year)The rent at a rate or average rate per year2% of annual rent

Section 56 charges a lease “so far as the consideration therefor consists of rent” under the Lease heading. Section 57 treats any premium or other non-rent payment as a conveyance on sale, so a premium pays 4% if the property is in a municipality (item 12A) or 2% elsewhere (item 11). Section 58 charges a lease in perpetuity as a conveyance on the value of the property. Section 55(1) charges an agreement for a lease as if it were the lease itself.

Worked example. Annual rent of KES 600,000. A 12-month lease, whole amount KES 600,000: KES 20 + 598 × KES 10 = KES 6,000. A 2-year lease: 600 × KES 10 = KES 6,000 (charged on one year’s rent, not on the KES 1.2 million total). A 5-year lease: 600 × KES 20 = KES 12,000.

The versions that circulate

VersionWhat it saysWhat is wrong with it
Three bands by term1% up to 1 year, 2% for 1-3 years, 4% over 3 yearsItem 21 has no 4% rent rate. One to three years is about 1%, over three years about 2%. The 4% figure belongs to transfers and premiums in a municipality.
21-year band1% up to 3 years, 2% for 3-21 years, 3% above 21 yearsItem 21 has no 21-year band and no 3% rate. Every term over three years, and every indefinite term, pays about 2%.
KES 3,000 thresholdKES 200 a year up to KES 3,000 annual rent, then 1%The threshold in the Act is KES 2,000, and no KES 200 rate exists.
Urban 4% / rural 2% of rent times the termRural leases 2% and urban 4% of annual rent multiplied by the unexpired termRent duty is on one year’s rent and has no urban/rural split. The 4%/2% location split applies only to premiums (s.57) and transfers.
Residential 1% / commercial 2%The rate depends on the use of the propertyThe Act never asks about use; the rate depends on the term.

Two related claims also circulate for land transfers: that the 4% rate applies to non-citizens and 2% to citizens, and that the 4% rate was introduced by a recent Finance Act. Cap. 480 draws the line by location (item 12A “situated in any municipality” against item 11 for property elsewhere), and the amendment list printed under the Schedule heading ends with Act No. 15 of 2017, with no Finance Act of 2023 or 2024.

Which source is primary

The Stamp Duty Act (Cap. 480) is the primary source, read in Kenya Law’s revised text. Revenue authority guidance and online calculators apply the Act but cannot change its rates. A Finance Act can amend the Schedule, so check the version date on Kenya Law.

Points the Act leaves open

A term of exactly one year fits both the first band (“not exceeding one year”) and the second (“not less than one year”). The arithmetic is close (total rent against one year’s rent), but the Act does not say which applies.

“Rate or average rate”: with stepped rent, the average annual rent over the term is the base.

Which figure our documents use

Our Kenyan lease and tenancy documents follow item 21: about 1% of the total rent for a term of up to one year, 1% of one year’s rent for one to three years and 2% of one year’s rent for a longer or indefinite term, with the 4% / 2% conveyance rates mentioned only for premiums and transfers. The Act is the only source that sets the rate, so the documents take the figures from it rather than from guides.

Check it yourself

  1. Open the Stamp Duty Act on Kenya Law and confirm the page says it is the latest version. Note the date.
  2. Search the page for “21. Lease or Licence” and read the three rent sub-items and the “Person responsible for Stamping” column.
  3. Read sections 55 to 58 for agreements for a lease, premiums and perpetual leases, and items 11 and 12A for the conveyance rates a premium uses.
  4. Compute: for a term up to one year, use the total amount payable; for longer terms, use one year’s rent (or the average if rent changes). Divide by KES 1,000, round any part up, and multiply by KES 10 (one to three years) or KES 20 (longer).
  5. Compare with the assessment you receive; if it differs, ask the Collector of Stamp Duties which item was applied.

Sources

Every source above was opened and read on 31 October 2026. Fees and procedures change by legal notice, Finance Act or registry update, so check the date on each source before relying on a figure.

How to cite

Attribution (CC BY 4.0)

“Kenya lease stamp duty: what the Act says against the versions that circulate” by Forms Legal, https://forms-legal.com/facts/discrepancies/kenya-lease-stamp-duty-rates-item-21. Licensed under CC BY 4.0 (https://creativecommons.org/licenses/by/4.0/).

BibTeX
@misc{formslegal_discrepancy_kenya_lease_stamp_duty_rates_item_21,
  author       = {{Forms Legal}},
  title        = {Kenya lease stamp duty: what the Act says against the versions that circulate},
  year         = {2026},
  publisher    = {Forms Legal},
  url          = {https://forms-legal.com/facts/discrepancies/kenya-lease-stamp-duty-rates-item-21},
  howpublished = {\url{https://forms-legal.com/facts/discrepancies/kenya-lease-stamp-duty-rates-item-21}},
  note         = {Reference note. Licensed under CC BY 4.0}
}

Licence: Creative Commons Attribution 4.0 International. Cite the official sources above for the figures themselves.

Related fact tables

More cases: where official sources disagree.

Reference information, not legal advice. Forms Legal is not a law firm.