Staff loan fringe benefit tax calculator Kenya
Find out the tax your company pays on cheap or interest-free staff loans, and the interest rate that avoids it.
How fringe benefit tax on loans works
When an employer lends staff money at a rate below the market rate published by KRA, the gap is a taxable benefit. The employer, not the employee, pays fringe benefit tax on that benefit at the corporation tax rate, normally 30% for a resident company. KRA publishes the market rate every quarter.
Assumes a resident company paying 30%. Some loans are exempt, and different rules apply to other benefits. Check the conditions before relying on the result.
Set staff loan repayments with the loan repayment calculator and see how pay is taxed in the PAYE bands guide. The PAYE calculator shows the payslip effect.
Common questions
Who pays the tax, the employee or the company?
The employer pays fringe benefit tax. It is a cost to the company and not deducted from the employee.
What is the market rate now?
KRA published 8% for January to September 2026 and 9% for October to December 2026.
How do I avoid it?
Charge interest at or above the market rate, or review whether the loan is exempt under the rules.
Related calculators and guides
Staff loans on the books?
We check loan terms, calculate fringe benefit tax and file it on time.
Ask for a books checkEstimates for guidance only, not tax advice. Rates were checked in October 2026 and can change. Confirm with KRA or a qualified professional.