The Kenya Revenue Authority (KRA) has won the right to collect Ksh18 million from Leah Njeri Njiru, wife to businessman Patrick Njiiru Kuria, who are directors of Neo Kenya Mpya Commuters Ltd, in a Ksh9 billion tax evasion suit.
Justice David Majanja upheld the decision made by the Tax Appeals Tribunal ruling that Njeri had an obligation to pay KRA Ksh18 million in tax liabilities.
“The commissioner arrived at the revised assessment of Sh18 million after correspondence and meeting between it and the appellant.
At the Tribunal, the appellant did not demonstrate the tax decision was wrong. I, therefore, do not fault the tribunal for accepting the conclusions reached by the commissioner,” stated Majanja.
The Tax Appeals Tribunal had in January 2021, made a ruling that Paleah Stores, owned by the couple, owed KRA Ksh1.3 billion in corporation tax and Ksh7.8 billion in VAT coupled with penalties and interest from between 2008-2014.
KRA had in 2015 filed a suit against the couple, seeking to collect Ksh9.1 billion in corporate and value-added tax (VAT) from Paleah Stores Ltd between 2008 to 2014.
According to court documents, KRA first heard of the possible tax evasion practices at Paleah Stores in 2015 which led them to request a tax audit into the company’s books.
From the audit of the accounting records and banking information, it was established that the firm owed KRA Ksh10.3 billion in tax.
The firm had however contested the bill, defending that its tax liability between 2008 and 2014 was Ksh60 million and that KRA owed it Ksh135 million in VAT refunds.
According to KRA, Njeri had not filed any income tax returns despite having several sources of income, prompting KRA to seek Ksh306 million from her.
Njeri, however, successfully appealed the case that saw KRA reduce the tax liability from Ksh306 million to Ksh18 million.
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