Corporate income tax is imposed by Decree No. 3 of 1955, as amended by Law No. 2 of 2008, at 15% on foreign entities carrying on business in Kuwait, whether directly or through a Kuwaiti counterparty. Kuwaiti shareholding companies are separately subject to the National Labour Support Tax under Law No. 19 of 2000, Zakat under Law No. 46 of 2006, and the contribution to the Kuwait Foundation for the Advancement of Sciences under Law No. 23 of 1979.
Since 1 January 2025, multinational groups within scope have instead been subject to a domestic minimum top-up tax at an effective rate of 15% under Decree-Law No. 157 of 2024 and the Executive Regulations issued in June 2025. For those groups we advise on registration within the statutory window, the computation of the effective tax rate, the transitional safe harbours, whether a permanent establishment arises on the definitions in the Regulations, transfer pricing documentation, and objections before the Tax Objection Committee and on appeal.
For foreign companies outside that regime, we advise on registration and filing, on the retention obligations imposed on the Kuwaiti party contracting with them, on the determination of taxable presence, and on the treatment of contracts, branches and subcontracting arrangements. Our work includes the choice of contracting entity, the allocation of scope between onshore and offshore work, the application of the double taxation treaties concluded by Kuwait, and the exemptions available under the direct investment regime.
We also build the supporting compliance framework, covering record keeping, documentation for intercompany charges, and the reporting obligations that follow from a presence in Kuwait, and we represent clients through inspection, assessment, objection and appeal. The amounts retained by a Kuwaiti counterparty are released against a tax clearance certificate, and how the contract was drafted determines how long that takes.