With the deadline for filing tax returns fast approaching, Kenyans are scrambling to ensure they beat the cutoff date.
Filing tax returns is the obligation of every Kenyan with a KRA Pin and failure to do so prompts penalties for the citizen.
Individual Income Tax Returns should be filed on or before June 30 and even though one can file their taxes at a later date, they will be liable to penalties.Residents queue outside the Kenya Revenue Authority (KRA) office in Nyeri in June 2017 ahead of the deadline to file their tax returns.File
What is the penalty for late filing and paying?
If you file your taxes after the June 30 deadline you will be charged with a fine of whichever is higher between 5 percent of the tax due or Kshs. 2,000.
Penalty on late payment is 5 percent of the tax due and a late payment interest of 1 percent per month on the unpaid tax until the tax is paid in full.
There are other Penalties charged on tax offences as well.
1. VAT - Value Added Tax is charged on the supply of taxable goods or services made or provided in Kenya and on the importation of taxable goods or services into Kenya.
Penalty on late filing: Whichever is higher between, Ksh 10,000 and 5 percent of the tax due.
Penalty on late payment: 5% of the tax due and a late payment interest of 1 percent per month on the unpaid tax until the tax is paid in full.
2. Failure to deduct PAYE, account for it or to submit a certificate upon request will attract a penalty of whichever is greater of, 25 percent of the amount of tax involved or Ksh 10,000.
3. Failure to deduct or pay Withholding Tax is charged 10 percent of the amount of the tax involved, up to a maximum of Kshs. 1 million.
4. Failure to pay Stamp Duty - Additional 5% of the payable duty for every quarter, from the date of the Instrument.
5. When one fails to pay tax on the due date an additional 20 percent of the tax involved is charged.
6. One will pay Ksh2,000 for any KRA PIN-related offense.
Kenya Revenue Authority in its bid to improve service delivery to its clients, the taxpayers, has implemented a mobile phone-based services platform, The KRA M-Service.
How to Pay your penalties on M-Pesa
You log in to your account
Navigate to “Payment” registration and follow prompts to the penalty
Fill in the details and download your electronic slip from your account at the KRA website
The E-slip will contain your ‘Payment Registration Number’ you’ll use this number as your account when paying via Mpesa
You then go to your M-Pesa Menu
Select Lipa na Mpesa
Choose Paybill and enter Kenya Revenue Authority (KRA) Mpesa Account Number: 572572 this will serve as the business number
For account number, enter the 'Payment Registration Number' generated in the portal.
Enter the amount due
Enter your Mpesa pin and press OK
You will receive a transaction confirmation message from M-Pesa.
You will receive a message from KRA informing you that payment has been received.KRA M-Service
How do you pay Individual Income Tax?
After filing the return online via iTax, generate a payment slip and present it at any of the appointed KRA banks to pay the tax due.
You can also pay via M-Pesa using the KRA Pay bill number 572572.
The Account Number is the Payment Registration number quoted at the top right corner of the generated payment slip.
KRA Compliance Check on Tax Returns
KRA also performs Compliance Checks on Tax Returns in accordance with the mandate granted under various laws.
The compliance checks may cover issues on Individual Income Tax (individuals or corporate companies), VAT, and Customs Duty, Excise, PAYE, Withholding, and other taxes administered by KRA.
KRA is advising all taxpayers with outstanding tax liabilities and has not entered payment plans to do so by June 20, 2020.
For further inquiries:
Call: 020 4999999 or 0711 099999
Email: call firstname.lastname@example.org
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