Computation of credits under special arrangements.
(1)
This section shall have effect where, under a special
arrangement, foreign tax payable in respect of income derived by a person
resident in Kenya is to be allowed as a credit against tax chargeable in respect of
that income.(2)
(Deleted by 2 of 1976, s.2)(3)
The tax chargeable upon the income of a person in respect of
which a credit is to be allowed under a special arrangement shall be the amount
by which the tax chargeable (before allowance of the credit) in respect of his
total income is increased by the inclusion of that income in his total income; but
where foreign tax is payable at different rates on different parts of the total
income of that person, the tax chargeable on that income shall be apportioned to
each part in such amounts as the Commissioner may determine to be just and
reasonable.(4)
A credit shall not exceed the lesser of the tax computed in accordance
with subsection (3) or the foreign tax chargeable upon the income in
respect of which the credit is to be allowed or upon each part of that
income.(5)
Where -- (a) a special arrangement provides, in relation to dividends of some classes but not in relation to dividends of other classes, that foreign tax not charged directly or by deduction in respect of dividends is to be taken into account in considering whether any, and if so, what, credit is to be given against tax in respect of those dividends; and
- (b) a dividend is paid which is not of a class to which those arrangements so apply.
(6)
A credit shall not be allowed under a special arrangement against
tax chargeable upon the income of a person for a year of income if he elects by
notice in writing to the Commissioner that credit shall not be allowed in the case
of his income for that year of income.(7)
Where the amount of a credit or exemption given under a special
arrangement is rendered excessive or insufficient, by reason of an
adjustment of the amount of income tax, or tax of a similar nature
payable either in Kenya or elsewhere, nothing in this Act limiting the time
for the making of assessments or claims for relief shall apply to an
assessment or claim to which the adjustment gives rise, being an
assessment or claim made within six years from the time when all those
assessments, adjustments and other determinations have been made,
whether in Kenya or elsewhere, that are material in determining whether
any and, if so, what credit is to be given.(8)
In this section, "credit" means a credit mentioned in
subsection (1).Previous Next
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