KFAS Levy
Written in plain language for general understanding. This is educational content, not legal advice. Based on Kuwaiti national legislation, Amiri decrees, and ministerial decisions.
Kuwaiti National Law
What is this right?
Kuwaiti shareholding companies must pay a levy to the Kuwait Foundation for the Advancement of Sciences (KFAS):
- The KFAS levy is 1% of net profits for Kuwaiti shareholding companies.
- This funds scientific research, education, and technological development in Kuwait.
- The levy applies to Kuwaiti public and closed shareholding companies.
- It does not apply to foreign companies (they pay corporate income tax instead).
- Some exempt categories exist — consult KFAS for the latest exemptions.
When does it apply?
- You own or manage a Kuwaiti shareholding company that earns a profit.
- Your company is preparing its annual financial statements.
What should you do?
- Calculate 1% of net profits and include it in your financial planning.
- Pay the levy on time as part of your annual financial closing.
- Consult with your auditor to confirm the correct calculation method.
What should you NOT do?
- Do not ignore the KFAS obligation — it is mandatory for covered companies.
- Do not underreport profits to reduce the levy — this can trigger audits.
- Do not confuse KFAS with corporate tax — they are separate obligations.
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