Dear members, - i would like to know legal ways which a business man/woman in Kenya can use to minimize their tax exposure. For instance is it better to pay dividends than bonuses given that the latter attract tax at 30 percent and dividends only 5 percent?

You got to differentiate between personal and corporate taxation. If the business man is a director in his own company, bonus is a company expense but an income to him. Company will deduct the expense from its income b4 taxing. The business man will however pay personal tax at 30%. For dividends the company cannot deduct as an expense, which means the income is already taxed on company at 30%. the dividend receiver is further taxed at 5%but the director does not pay further tax. If the company is a one man show, then its better to pay the bonus

@ kamaa and others thanks. My focus is on a director who is also owner/shareholder.

can an individual tax payer claim FX losses(realized or unrealized) as an allowable deduction for tax purposes?

I have been informed that KRA is writing to all County Planning offices requesting for all plans approved from last year including the name of client, title deed number, approval date, architect name, etc. Further, they are visiting building sites asking whether witholding tax was paid for architect's fees, structural engineer.. etc Is it true? If it is true, then it might be a sign that our Government has serious revenue shortfalls.