I recently needed to pay the Tourism Catering Levy in Kenya but wasn’t sure about the process or payment options. Since this levy is mandatory for certain businesses, it’s important to understand how to calculate and pay it on time.
If you run a hotel or restaurant, here’s a simple guide to help you stay compliant.
Quick Answer
To pay Tourism Catering Levy in Kenya, calculate 2% of your gross sales, then pay via Mpesa Paybill 884500 or through designated bank accounts before the 10th of the following month.
What Is Tourism Catering Levy in Kenya?
Tourism Catering Levy is:
- A 2% charge on gross sales
- Paid by hotels and qualifying restaurants
- Submitted to the Tourism Fund
It must be paid by the 10th of the next month after sales.
Who Should Pay the Catering Levy?
Hotels
- Charging at least KSh 250 per person per night
Restaurants
- Annual turnover of KSh 3 million+
- Or average KSh 250,000 monthly for new businesses
How to Calculate Tourism Catering Levy
Step 1: Determine Gross Sales
Calculate total monthly revenue from:
- Accommodation
- Food and drinks
- Other services
Step 2: Apply 2% Levy
Levy = 2% of total gross sales
Step-by-Step: How to Pay via Mpesa (Paybill 884500)
Step 1: Open Mpesa Menu
Go to Mpesa on your phone.
Step 2: Select Lipa na Mpesa
Choose “Lipa na Mpesa”.
Step 3: Select Paybill
Tap on Paybill option.
Step 4: Enter Business Number
Enter 884500.
Step 5: Enter Account Number
Input your hotel or restaurant code.
Step 6: Enter Amount
Enter the calculated levy amount.
Step 7: Enter PIN and Confirm
Input your Mpesa PIN and press OK.
Step 8: Receive Confirmation
You will receive an Mpesa confirmation SMS.
Alternative: Pay via Bank
You can also pay through:
- Cooperative Bank (Parliament Road Branch)
- Kenya Commercial Bank (KICC Branch)
Use the provided account numbers and details when making payment.
Penalties for Late Payment
- Immediate penalty of KSh 5,000
- Additional 3% monthly penalty on unpaid amount
Consequences of Non-Compliance
- Fine up to KSh 20,000
- Possible imprisonment (up to 6 months)
- Legal recovery of unpaid levy
Extra Tips and Best Practices
- Pay before the 10th to avoid penalties
- Keep accurate sales records
- Save your Mpesa confirmation message
- Register early with Tourism Fund
- Double-check your business code
Common Mistakes to Avoid
- Miscalculating gross sales
- Paying after the deadline
- Entering wrong account number
- Ignoring penalties
- Not keeping payment records
FAQ
What is the Tourism Catering Levy rate?
It is 2% of gross monthly sales.
What is the Mpesa Paybill number?
The Paybill number is 884500.
When should I pay the levy?
By the 10th of the following month.
Conclusion
Paying the Tourism Catering Levy in Kenya is straightforward if you calculate correctly and pay on time. Use Mpesa or bank options, keep records, and stay compliant to avoid penalties.
