Unlock Big Tax Savings with the Income Tax (Charitable Organisations and Donations Exemption) Rules, 2024!

Get ready for a game-changer! At Kubwa and Company Advocates, we’re thrilled to share the Income Tax (Charitable Organisations and Donations Exemption) Rules, 2024, launched by the Kenya Revenue Authority (KRA). These rules kicked off on August 23, 2024, under Legal Notice No. 105, and they’re packed with tax exemptions that can save you money while helping great causes. Whether you run a charity or love donating, this is your chance to enjoy tax relief—and we’ve got the details as of February 26, 2025, to make it simple and exciting!

What Are These New Rules?

The Income Tax (Charitable Organisations and Donations Exemption) Rules, 2024, update the Income Tax Act to give tax breaks to charities and donors. Announced in a KRA notice on August 23, 2024, they make it easier to support good causes without losing cash to taxes. If you’re a charity or a donor, these rules mean more money for what matters.

Tax Breaks for Charities

Charities can skip paying income tax if they focus on things like education, health, or helping the poor, as listed in the First Schedule. They just need to prove they don’t make profits and get approval from the KRA Commissioner. This tax exemption means more cash for their work—but they must follow the rules, or they could lose it (Rule 8).

Tax Savings for Donors

Love donating? You can cut your taxes by giving up to KES 10 million a year to approved charities (Rule 5). Whether it’s cash or stuff like property, donations to qualifying groups lower your taxable income. Give KES 5 million, and you save on taxes while doing good—talk about charitable tax benefits!

How to Apply for Tax Exemptions

Want these tax exemptions? Charities apply to the Commissioner through the KRA iTax portal or in person. They need:

Registration Proof: A certificate showing they’re legal.
Rules Document: Papers proving they’re about charity, not profit.
Money Records: Two years of accounts (existing charities) or a plan (new ones).
Work Proof: Reports showing what they do or plan to do.

The Commissioner checks it in 60 days and gives a five-year pass if it’s all good (Rule 6). Donors just need a receipt from the charity to claim their donation tax exemption when filing taxes on iTax.

Rules for Existing and New Charities

Existing Charities: If you already have a tax break, you must reapply by June 30, 2025. Show updated papers proving you’re still helping people and not making profits (Rule 4). Miss this date, and your tax relief for charities could disappear.

New Charities: Started after August 23, 2024? Apply within six months of registering. Show your plans and keep clean money records. You might get a temporary okay (Rule 7), but you must fully comply within a year to keep the income tax exemption.

Both need to file yearly reports and use money only for charity work. Slip up, and Rule 8 says you’re in trouble!

Why This Matters

Since August 23, 2024, these rules help charities grow and reward donors with tax deductions. With deadlines like December 31, 2024, for existing charities and six months for new ones, now’s the time to jump in and save big.

We’re Here to Help!

Taxes can feel tricky, but we makes it easy. Our team can handle your 2024 tax exemptions, whether it’s charitable organization tax relief or tax-deductible donations. Call us today to beat June 30, 2025, or your new charity’s deadline and grab those tax savings with a smile!

Talk to us now by Scheduling a Meeting Here or direct chat on WhatsApp Here or by clicking on the live chat in the bottom right corner.

Should you require more information, please do not hesitate to contact [email protected].