Category Archives: Updates / Announcements

JR Advocates wishes to congratulate Ms. Josephine Righa for her nomination as the Commercial Practitioner of the year 2023 by the Nairobi Legal Awards. Your unwavering focus, diligence, and commitment have led you to this remarkable achievement.

This nomination reflects your dedication, passion, focus and you deserve every bit of success that comes your way. We wish you continued success and fulfillment in all your future endeavors. Congratulations!

DID YOU KNOW that the President, HE Uhuru Kenyatta assented to the Law of Succession (Amendment) Bill, an amendment to Section 29 of the Succession Act in bid to streamline the administration of succession matters?

According to the Memorandum of objects, the reason for this amendment is “to lock out opportunistic schemers from successfully claiming a stake in the deceased property and disenfranchising the legitimate heirs”.

This amendment in law now further constricts the dependants entitled to inherit property to only spouses (as recognized under the Marriage Act, 2014) and the children of the deceased whether or not maintained by the deceased prior to their death. This means that former wife/wives and/or divorcees will no longer be entitled to a claim of their deceased former spouses’ property. In addition, secret wives, stepchildren, half brothers and sisters as well as distant dependants will no longer have a right to inheritance in the event of a benefactor’s death.

To further note, this amendment now provides that a person not qualifying as a dependant according to the Act, will have to prove that he/she was maintained by the deceased for a period of two (2) years prior to the deceased’s death in order to qualify as a dependant.

Now you know! Should you wish to engage us further on this subject, please do not hesitate to reach us on enquiries@jradvocates.com.

Following the enactment of the Sectional Properties Act no.21 of 2020) on 11th December 2020, the Ministry of Lands and Physical Planning put out a public notice calling for the conversion of all long term subleases intended to confer ownership of apartments, flats, maisonettes, townhouses, villas, godowns or offices that do not conform to section 54(5) of the Land Registration Act, 2012 which states that ‘the Registrar shall register long-term leases and issue certificates of lease over apartments, flats, maisonettes, townhouses or offices having the effect of conferring ownership, if the property comprised is properly geo-referenced and approved by the statutory body responsible for the survey of land.’

The Ministry of Lands and physical planning has embarked on the process of conversion of long-term leases registered based on architectural drawings to conform to the Sectional Properties Act, 2020 and the Land Registration Act, 2012.

The following documents are required to facilitate the process of conversion:
i. Sectional plan
ii. Original title
iii. Long term lease previously registered
iv. Rent apportionment for the unit where applicable

Upon conversion and/or registration, the original registers shall be closed and new registers opened with respect to each of the units on the plan.

No additional costs on stamp duty shall be incurred by the owner(s) of the property if they had paid the requisite stamp duty fees when registering the long-term leases.

Should you be among those affected by this new law, kindly contact us via legal@jradvocates.com for assistance in conversion.

There is a new company regulation that requires all companies to lodge with the Registrar of companies by the 31st of January 2021, a list of its beneficial owners i.e. the ultimate natural persons who own and control a Company.

The Regulations define a beneficial owner as a person who:

  1. holds at least 10% of the issued shares in the company either directly or indirectly;
  2. exercises at least 10% of the voting rights in the company;
  3. holds a right to directly or indirectly appoint or remove a director of the company; OR
  4. exercises significant influence or control over the company (participation in the finances and financial policies of a company without necessarily having full control over them)

Though the regulations are meant to disclose the owners of companies that own companies and nominee shareholders, please be advised that even companies owned by natural persons are required to comply with this regulation and also update the Beneficial Owners (BO) register anyway.

 

Be advised that failure to comply with this Regulation will attract a fine of up to KES. 500,000/- for each officer of the company in default and a possibility of KES. 50,000/- penalty for each day in default if the default continues.

 

Please do reach out to us on enquiries@jradvocates.com so we can help keep your company compliant.

As the corona virus (COVID-19) Pandemic continues to spread across the world and in our country Kenya, we at JR Advocates are deeply concerned about its effect on not only our people but on you our esteemed clients as well. We urge you to continue to follow the Government’s Directives as put in place for the sake of not only yourselves but of your neighbors alike. We have been monitoring the situation closely and while the Virus may not have affected us directly as yet (and we are grateful to God), we are taking the situation rather seriously and have put in place measures to contain its spread.

To this end, and in support of the Government’s directive to observe social distancing, we have made the requisite arrangements to enable our team work remotely.

Whilst we appreciate that some of the Government offices have temporarily closed including the Lands Registries, Immigration Offices, Courts, Societies Registry and Offices of the Registrar of Companies, we are committed to continue serving you the best way we can with the aim of ensuring your business continuity. Some of the services we will be offering during this period will include but not limited to :-

  1. Legal opinions and research as needed;
  2. Documents and Contract reviews, finalization, advisory and management especially with regards to fulfillment of contractual obligations under the current situation;
  3. Advisory on Employment Contracts – options available to employers in the current situation, redundancy and other employment termination options;
  4. Advising Real Estate players on interpretation and implementation of terms of Commercial Lease Contracts, Construction Contracts, Tenancy Agreements, Sale Agreements, Project Development Agreements and Undertakings;
  5. Business formation and company secretarial services;
  6. Provide Tax advisory services on the implications of submission of Returns, payment extensions and enforcement measures by the Kenya Revenue Authority as per Government’s directives in light of the Pandemic;
  7. Reviewing of existing credit facilities and other financial instruments to allow for negotiations, restructures and waivers as and when the need shall arise;
  8. Management of active dispute proceedings;
  9. Attestation and notarization of documents; and
  10. Any other legal service as may be reasonable to be undertaken in this period.

We will remain available to assist you on email and phone as our first point of contact in an effort to help manage and reduce the spread of the Virus through physical interactions. Whilst physical meetings may not be advised in the meantime, we do have virtual meeting applications that we can both use to ensure maximum and effective delivery of any legal needs you may have. For further assistance, please do not hesitate to reach us through; jrigha@jradvocates.co.ke and / or enquiries@jradvocates.co.ke. You may also contact our Managing Partner, Ms. Righa on her direct line +254 724 294 015.

In conclusion, we urge you to take all precautionary measures to ensure we all contribute towards containing the spread of the COVID-19 virus. Our team will continue to monitor the situation as it develops and adapt accordingly.

We at JR Advocates do appreciate your continued partnership. We continue to pray for your safety and business continuity in this unprecedented time and look forward to doing business together.

President Uhuru Kenyatta assented the Tax (Amendment) Bill, 2020 bill into law with a view of cushioning Kenyans against the adverse effects of COVID-19. Turnover tax experienced major transformation especially by setting the new threshold to cover entities earning annual revenue between Kshs. 1m to Kshs. 50m.

However, entities opting for Turnover tax regime will be forced to start paying taxes and filing monthly returns (over and above the VAT returns) regardless of whether they are making profits or not. Additionally, entities shall forfeit all the carry forward claimable losses.

Click here to see the full regulations as published by KRA.

On Saturday 25th April 2020, President Uhuru Kenyatta signed into law the Tax (Amendment) Bill,2020 effectively cushioning Kenyans against the adverse effects of the COVID-19 Pandemic. This followed by a publication of the Kenya Gazette Supplement No. 56 (Act No. 2) on 27th April 2020. Some of the new tax changes include the following;

  1.  Pay as you Earn (PAYE)
     Tax Relief:
    100 % Tax Relief for resident individuals earning a gross monthly income of up to Kshs. 24,000 (Kshs.288,000 p.a.) by introducing personal relief of Kshs. 2,400 p.m (Kshs.28, 800 p.a.) The individual resident tax relief effectively rises from the previous Kshs.16,896 per year (or KES 1,408 per month) and applies to all the employees.
  2. Reduction of Income Tax
    Reduction of Resident Income Tax (Corporation Tax) from 30% to 25%.
    However, the non-resident companies and branches will still be taxed at 37.5%

READ MORE…

Meaning of Instalment Tax in Kenya?

Instalment tax is estimated income tax paid to KRA periodically, to cover the total tax payable for the year of income. Installment tax is administered under the Income Tax Act Cap 470, laws of Kenya. 

Who is eligible for Instalment Tax?

If the annual tax liability is projected to exceed Kshs. 40,000, then you should pay your tax in installments.

When do I project the tax liability for the year?

Projection is normally done at the beginning of the financial year. While projecting the annual tax liability, the expected withholding tax for the year needs to be netted off to arrive at the net estimated tax liability.

How do I structure the tax in instalments?

The Income Tax for the current year is paid on instalment basis as below;

  • 1st Instalment – by 20th of the fourth month
  • 2nd Instalment – by 20th of the sixth month
  • 3rd Instalment – by 20th of the ninth month
  • 4th Instalment – by 20th of the twelfth month

NB: Balance of Tax (return balance) to be paid by end of the 4th month after the year-end. i.e. by 30th April 2020 for December year-end cases.

However, taxpayers in the Agricultural Sector pay in instalments as follows;

  • 1st Instalment – 75% in the 9th month
  • 2nd Instalment – 25% in the 12th month.

How do I pay Instalment Tax?

Instalment tax is paid via iTax. Generate a payment slip and present it together with the cheque drawn in favor of Kenya Revenue Authority, at any of the KRA appointed banks.

Is there a penalty for late payment?

Penalty for the late payment of income tax shall apply.

President Uhuru Kenyatta on Wednesday 25th March 2020 announced a raft of measures to help tackle the Covid-19 outbreak in Kenya. With the view of cushioning Kenyans against the Corona Virus Pandemic, the National Treasury implements the following immediate reliefs to increase disposable income to the people of Kenya.

Read more on Economic Measures to Curb the effects of Corona Virus