Income Tax in Kuwait

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Income tax for individuals and corporates in Kuwait is summarized below

Income earned from activities in Kuwait shall be considered subject to tax in Kuwait. In cases where a contract involves the performance of work both inside and outside Kuwait, the entire revenue from the contract must be reported for tax in Kuwait, including the work carried out outside Kuwait. Please refer to the Income determination section for more information on income that is subject to tax in Kuwait.

The current tax rate in Kuwait is a flat rate of 15%.

Foreign companies carrying on trade or business in the offshore area of the partitioned neutral zone under the control and administration of Saudi Arabia are subject to tax in Kuwait on 50% of taxable profit under the law.

Zakat

Zakat is imposed on all publicly traded and closed Kuwaiti shareholding companies at a rate of 1% of the companies’ net profits.

Contribution to the Kuwait Foundation for the Advancement of Sciences (KFAS)

All Kuwaiti shareholding companies are required to pay 1% of their net profits as per their financial statements, after their transfer to the statutory reserve and the offset of loss carry forwards, to the KFAS, which supports scientific progress.

Kuwait is one of few countries which has lowest tax on income. While most countries charge as high as 60 % of the income, Kuwait charge a flat rate of 15 %.

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