The verdict in three sentences
A referral agent who does not provision for tax ends up with a painful bill at year-end. Best practice: set aside a fixed percentage on every commission collected. In Kenya, small agents often fall under a 3 % turnover tax registered via the BRS with a KRA PIN, and anticipating spares you any cash-flow stress.
Why provisioning changes everything
A commission collected is not net income: a share goes to the state. The classic beginner's mistake is to spend it all, then discover the tax due months later. By provisioning the moment each payment arrives, you smooth the charge and never touch the taxman's money.
The simple rule: open a dedicated sub-account or wallet, and automatically transfer the estimated percentage there on each commission. You only draw from it to pay your instalments and tax balance.
Bracket scale and recommended provision
| Annual income bracket (2026 order of magnitude) | Estimated marginal rate | Estimated tax on bracket | Advised provision |
|---|---|---|---|
| 0 - 500,000 FCFA | ~0-10 % | low | 5 % |
| 500,000 - 1,500,000 FCFA | ~15-20 % | moderate | 10 % |
| 1,500,000 - 3,000,000 FCFA | ~20-25 % | notable | 15 % |
| 3,000,000 - 6,000,000 FCFA | ~25-30 % | high | 18 % |
| above 6,000,000 FCFA | ~30 %+ | strong | 20 % |
These rates are orders of magnitude: the exact scale and allowances depend on your status (sole proprietor vs company) and should be confirmed with an accountant or the tax authority.
Regional comparison: Kenya (BRS/KRA) vs Burkina Faso
| Item | Kenya (BRS/KRA) | Burkina Faso |
|---|---|---|
| Registration | BRS + KRA PIN | RCCM / tax office |
| Small turnover | turnover tax 3 % | simplified regime |
| Income tax | PAYE if salaried | income tax by brackets |
| Corporate tax | corporate tax | corporate tax |
| Tax ID | KRA PIN | IFU |
In Kenya, a small agent often falls under 3 % turnover tax on gross revenue, a very simple flat scheme. If salaried alongside, income shifts to PAYE. Registration is done via the Business Registration Service (BRS) with a mandatory KRA PIN to invoice.
Need a professional website?
Kolonell builds websites that attract clients, optimized for the Sénégalese market. Free quote in 2 minutes.
Mini case study
John, an agent in Nairobi, collects the equivalent of 2,400,000 FCFA in commissions over the year. He provisions 15 % the moment each payment arrives, i.e. 360,000 FCFA set aside gradually. At year-end, his estimated tax fits within that envelope: he pays without touching his working cash. Net kept after tax: ~2,040,000 FCFA, with no shock.
FAQ
What percentage should I provision on my commissions? An order of magnitude of 5 to 20 % depending on your bracket. For 2.4M FCFA of commissions, aiming for 15 % is prudent.
How does turnover tax work in Kenya? For small turnovers, the 3 % turnover tax replaces standard income tax: simple, flat, computed on gross revenue.
When must I file? Instalments and the annual return follow the KRA (Kenya) or tax office (Burkina) calendar. Anticipate deadlines to avoid late penalties.
Sole proprietor or company to pay less tax? It depends on volume: below a threshold, a sole proprietor is often lighter; above it, a company's corporate tax can become advantageous. Arbitrate with an accountant.
What happens if I don't file? You expose yourself to penalties and surcharges, and you close the door to institutional contracts that check their providers' tax compliance.
Becoming a Kolonell referral partner
Managing tax well makes regular income sustainable. The Kolonell referral program pays 15 % + 5 % recurring (showcase), 12 % (e-commerce), 10 % (marketplace), 8 % (institutional). At 2.4M FCFA of annual commissions, provisioning 15 % still leaves you over 2M net.
Let's talk about your project. We help you structure your referral income and provision for tax. WhatsApp +221 77 596 93 33.
Mohamed Bah
Fondateur, Kolonell
Passionate about digital and entrepreneurship in Africa, Mohamed has been helping Sénégalese businesses with their digital transformation since 2020. Founder of Kolonell, he believes every SME deserves a professional and accessible online présence.
