When a tax change is reported, people ask the same question: from when? The answer matters more than the headline. Applying a new rate a month too early or an old one a month too late means a wrong payroll, a wrong invoice or a wrong return, and sometimes a penalty. This guide explains the common ways dates work, so you can find the rule that applies to your transaction.

Announcement, passing and commencement

Three different dates can apply to a change. The announcement is when it is first proposed, often in a budget speech. The passing is when the law is signed. The commencement or effective date is when the change begins to apply. Only the last one matters for what you do. Until a change is law and in force, planning is sensible but applying it is not. How Finance Acts change your taxes and when they take effect explains the process.

Tax year changes versus mid-year changes

Some changes apply from the start of a tax year or the first day of a month; others from the day the Act is published or a later date set in the Act. For taxes charged on a full year, such as income tax for a company, a mid-year rate change may require the profit to be split by days before and after. For taxes charged on each transaction, such as VAT, the date of the supply or the invoice usually decides. For monthly taxes such as PAYE, the month in which the pay is earned or paid decides. Check the wording of the specific provision.

Which date counts for a transaction?

Ask what triggers the tax. For VAT, it is typically the time of supply, which may be the date of the invoice, the delivery or the payment, whichever is earliest under the rules. For PAYE, it is the pay period. For capital gains, it is the date of transfer, not the date the agreement was signed. For import duty, it is the date the customs entry is lodged. Our guide to capital gains tax increased to 15 percent shows how a date decides which rate applies, and the capital gains tax calculator estimates the result.

Transition rules

Laws often include transition provisions to deal with transactions that straddle the date. A typical rule might say that a contract signed before the date continues under the old rule, or that income earned before the date is taxed at the old rate even if received afterwards. These provisions are in the Act itself, so read them. Do not assume that a contract signed before the change is protected unless the law says so.

Rates that change during a pay period

When statutory deductions change, payroll must switch at the right month. NSSF rates change from February 2026 and minimum wage order 2026: new rates from May are examples of changes tied to specific months. Check the payroll software on the effective date, and test a payslip under the new rule with the PAYE calculator.

Deadlines and penalties

Procedural changes, such as new return deadlines or filing methods, have effective dates too. A change in penalty rules usually applies to periods after the date, not to earlier ones. If you are late, make sure you understand which penalty regime applies; see penalty and interest rates for late tax returns and payments and use the KRA penalty calculator. Occasionally an amnesty applies only within a window; tax amnesty: penalties and interest, what to know shows how such windows work.

Document your decision

When a change is near, write down which rule you applied and why, with the date and the source. If you apply the old rule to a transaction on the boundary, note why: for example, because the invoice was issued before the date. If KRA later asks, your note and the supporting documents explain your reasoning.

Use a calendar

Put effective dates in your calendar with a reminder two weeks before. On that day, review payroll, invoices, price lists and contracts. The KRA filing and payment calendar lists deadlines, and what to review in your finances when tax rules change gives a checklist.

When you are unsure

Ask. KRA publishes guidance on new provisions, and professionals can interpret transitions that are not clear. Get the answer in writing if it affects a large transaction. The cost of asking is small compared with a wrong assumption.

The key habit is to look for the date before you look at the rate. Once you know which rule applies to which date, the rest is arithmetic.