Insights
Operating in Kenya Without a Company
Insights · By Chen ChunJie · Published 8 November 2026
Many foreign companies start in Kenya with no local entity: they sell from abroad, work with contractors or hire their first employees through an employer of record. This guide explains what you can do without a Kenyan company, when you need one, and how to move from one stage to the next.
Last reviewed in November 2026 against the Employment Act 2007, the Regulation of Wages Orders of May 2026, the NSSF Act, the Social Health Insurance Act, the Affordable Housing Act and KRA guidance. Rates and limits change, so we confirm them for each engagement.
What you can do without a Kenyan company
| Activity | Kenyan company needed? |
|---|---|
| Employing staff in Kenya | Yes, or an employer of record that employs them for you |
| Engaging independent contractors for defined projects | No, if they are genuinely independent |
| Selling to Kenyan customers from abroad | Not for hiring, but check the tax position of your sales |
| Opening an office, signing local leases or bidding for public tenders | Usually yes |
| Sponsoring a foreign national’s work permit | Yes, or an employer that does it for you |
Why you cannot employ directly from abroad
An employer in Kenya registers with KRA for PAYE, with NSSF and the Social Health Authority, deducts and pays every month and issues a written contract under Kenyan law. A foreign company with no Kenyan presence has no practical way to meet these duties, and putting staff on contractor agreements to avoid them creates misclassification risk.
No Kenyan company yet? Our Local Team can be the legal employer while you manage the work. See Employer of Record in Kenya.
When a Kenyan company makes sense
A foreign company that sets up a place of business in Kenya registers with the Business Registration Service, either as a local subsidiary or as a branch of the foreign company. Most companies make the move once the team is large and long-term, once they sign contracts or invoice customers locally, or once they lease premises. Until then, an employer of record keeps hiring simple.
Permanent establishment risk
Employing people through an employer of record does not by itself give your company a taxable presence in Kenya, but what the employees do matters. A person who habitually negotiates or concludes contracts for your company, or a fixed office at your disposal, can create a permanent establishment. Review revenue-generating roles with your tax adviser.
Moving from an EOR to your own company
When your Kenyan company is registered and set up with KRA, NSSF and the Social Health Authority, we agree a transfer date. The Local Team ends the employment correctly and pays final dues, and the employee signs a new contract with your company, usually with their service recognised.
FAQ: operating in Kenya without a company
Can a foreign company employ people in Kenya without registering?
Not directly. It needs a Kenyan employer, such as an employer of record.
Can I hire contractors in Kenya without a company?
Yes, for genuinely independent work. See On-Demand Talent in Kenya.
Does an EOR create a permanent establishment?
Not by itself, but roles that conclude contracts for you can.
Can employees move to my company later?
Yes, on an agreed transfer date once your company is ready.
Hiring your first employee in Kenya?
Our Local Team employs the person, runs payroll, PAYE, NSSF, SHIF and the Housing Levy, and handles the paperwork, while you manage the day-to-day work.
Related
How we employ your team in Kenya.
Contracts, leave, termination and more.