Free invoice generator and tax tools for Kuwait

The tax a Kuwaiti business meets depends on who owns it, because the Income Tax Decree No. 3 of 1955 reaches bodies corporate rather than individuals. Article 1, as replaced by Law No. 2 of 2008, taxes any body corporate, wherever incorporated, that carries on trade or business by activity in Kuwait, and Article 9 sets the rate at 15% of net taxable income. Trading profits made on the Kuwait Stock Exchange, directly or through portfolios and funds, are exempt. The Ministry of Finance assesses and collects it. Kuwait levies no personal income tax in this decree.

Kuwaiti shareholding companies sit under separate levies, all collected by the Ministry of Finance. Law No. 46 of 2006 charges Zakat of 1% of annual net profit on Kuwaiti closed and public shareholding companies (Article 1), and excludes companies already subject to the 1955 Decree (Article 4). Law No. 19 of 2000 adds a 2.5% tax on the annual net profit of Kuwaiti companies listed on the stock exchange (Article 12). A sole trader or an unlisted company with no foreign owner will therefore usually meet neither, but a business that is paid under a government contract meets Article 37 of the Decree: the paying body keeps 5% of the contract price or of each payment against the supplier's Kuwaiti tax, and the tax authority disallows payments to subcontractors that the contractor has not reported.

The most recent reform is the Domestic Minimum Top-up Tax, in force since 1 January 2025 under Decree-Law No. 157 of 2024. The Ministry of Finance says it applies only to multinational groups with at least EUR 750 million of annual global revenue in two of the previous four years, taxes their Kuwaiti income up to a minimum of 15%, and replaces the labour support tax, Zakat, Divided Zone tax and corporate income tax for those groups. A small business is outside it.