Tax on Betting Winnings in Kenya 2026: 20% WHT, 5% Excise on Deposits and What Changed

Updated 31 October 2026

Tax on betting winnings in Kenya works in two layers in 2026: a 5% excise duty on every amount you deposit to bet or game, and a withholding tax on payouts that the operator deducts before the money reaches you, including 20% on winnings from lotteries and prize competitions. The rules come from the Finance Act, 2026, most of which took effect on July 1, 2026, as explained in KRA’s Finance Act 2026 guide.

Tax on betting winnings in Kenya at a glance

The 20% rate for winnings is also listed in PwC’s Kenya withholding tax table (reviewed July 2026).

What changed on July 1, 2026

1. Excise duty now applies to deposits, not wallets

The excise rate stayed at 5%, but the Act replaced the old wallet-based charge with a charge on any amount deposited for betting or gaming, whether or not it sits in a betting wallet. It also removed the old exclusion for horse racing, so those bets are now taxed too, according to EY’s summary of the Act.

2. The tax point moved to when money hits your account

“Withdrawals” now means any money, cash equivalent or money’s worth paid or disbursed to a player’s account by an operator licensed under the Gambling Control Act, 2025. Before, tax was triggered only when a customer withdrew from the betting wallet, so punters could delay tax by re-betting their winnings. EY notes this loophole is now closed: tax applies when the payout is credited.

3. Withholding tax on “winnings” is back

The Finance Act, 2025 had repealed the definition of winnings. The 2026 Act brings it back as a pay-out from a lottery or prize competition by a licensed operator, and taxes it at 20% for both residents and non-residents.

Worked example: what a punter actually pays

Say you deposit KSh1,000 to bet. The operator charges 5% excise on the deposit, which is KSh50. If you then win a KSh10,000 prize in a licensed lottery or prize competition, 20% withholding tax (KSh2,000) is deducted and you receive KSh8,000. Operators handle both deductions; your receipt or SMS should show them.

Do you need to declare betting winnings on iTax?

For residents, withholding tax on winnings is a final tax, so you do not pay more on that income when you file. If you also earn business, rental or online income, see our guide on tax on online income in Kenya for what to declare.

What operators must do

• Charge 5% excise on all betting and gaming deposits, including horse racing.
• Deduct withholding tax at the point a payout is credited to the player’s account.
• Remit withheld tax to KRA by the 20th day of the following month.
• Update systems so deposits and payouts are classified correctly, as KRA asks in its Finance Act guide.

Could betting taxes change again?

Betting taxes have changed in almost every Finance Act since 2018. The next round of proposals will come with the 2027 budget; see our explainer on the Finance Bill 2027 timeline and how to submit views.

FAQ

How much tax is deducted from betting winnings in Kenya?

Winnings from lotteries and prize competitions carry 20% withholding tax, deducted by the operator. Betting payouts are taxed when credited to your account.

Is there tax on betting deposits?

Yes. A 5% excise duty applies to every amount deposited for betting or gaming, including horse racing, from July 1, 2026.

Can I avoid tax by re-betting my winnings?

No. Since July 1, 2026, tax applies when the payout is credited to your account, not when you withdraw it.

Do I pay more tax when filing returns?

For residents, withholding tax on winnings is final, so no further tax is due on that amount.

Updated October 2026. Sources: Finance Act 2026, KRA, EY, PwC.