However, the majority of taxpayers still do not understand or are not aware of why they need to file returns, how to file them, and what declarations they need to declare.

This article, therefore, will try to answer some of the questions and clarify the myths and misconceptions in regards to KRA tax filing.

The requirement to file KRA Tax Returns

The tax laws -the Tax Procedures Act require taxpayers to file their taxes without failure. The Tax Procedures Act under Part V Sec 24 outlines the requirement to file tax returns and the Income Tax Act under Part VII.

Who Should File KRA Tax Returns

All taxpayers should file tax returns. These are all persons issued with a KRA Pin, this includes persons and registered entities i.e. Groups, Associations, Partnerships, Companies, Trusts etc.

Deadline for Filing KRA Tax Returns

The deadline for filing KRA tax returns is by 30th June of every year for personal PINS and for non-personal PINS, within 6 Months after the end of their accounting period.

Every person, other than an individual chargeable to tax under the Act, shall for any accounting period commencing on or after 1st January 1992, furnish to the Commissioner a return of income, including a self-assessment of his tax on such income, not later than the last day of the sixth month following the end of the year of income.

According to Section 54B of the Income Tax Act;
a)Every individual chargeable to tax under this Act shall for any year of income commencing with the year of income 1992, furnish to the Commissioner a return of income, including a self-assessment of his tax from all sources of income, not later than the last day of the sixth month following the end of his year of income; and

b)Every person, other than an individual chargeable to tax under the Act, shall for any accounting period commencing on or after 1st January 1992, furnish to the Commissioner a return of income, including a self-assessment of his tax on such income, not later than the last day of the sixth month following the end of the year of income.

Documents Required to File KRA Tax Returns

For an income tax return to be filed there are some documents required. Often, to ascertain the income and expenses to be disclosed to KRA for assessment of tax payable. The documents required include:

• P9 Form from Employer – for employed Persons
• Books for Accounts, i.e., Statement of Profit and Loss) for Business
• Audited Books for Accounts for Corporations.
• Others – Withholding Certificates

With these documents, a professional tax accountant can comfortably file your Tax returns, accounting for all allowable deductions and incentives provided by the tax laws.

A big mistake taxpayers make is getting non-professionals, e.g. Cyber People, to file their tax returns, which has often exposed taxpayers to penalties and audits by KRA. Therefore, it is imperative to get a professional and even a licensed KRA Tax Agent to file your tax returns, like us. Get in touch with our team for Professional KRA Tax Filing Services.

How to file KRA Income Tax Returns

As this article gives an overview of the Income Tax return – Tax of Income from Companies and Businesses, we only look at filing what is covered by the Income Tax Act. Other tax returns required to be filed periodically with KRA include;

• Employment Income (PAYE) – Filed by a registered employer on a Monthly Basis
• Value Added Tax (VAT) – filed monthly by a registered taxpayer.
• Turnover Tax
• Withholding Tax
• Exercise tax – filed by a business registered dealing with extensible goods

Filing of Nil Tax Returns

You might be wondering why KRA has to penalise taxpayers even where they do not have incomes. E.g. A Student who applied for a KRA PIN to apply for HELB or our grannies back upcountry that has to have a KRA PIN to get a KPLC Connection. Where a taxpayer has no income earned or accrued from Kenya, they should file nil returns.

Filing of Employment Income Only Tax Returns

Where an individual taxpayer only has employment income, they can file their income tax return on itax through the simplified ITR form. However, it is important to have a qualified tax agent do the return for you, as they will check to confirm all transactions on the itax ledgers are matching what is on the P9 and the auto-populated form.

Filing of Personal PIN with Business Income

Where an individual has business income, for instance, for one with a registered business name or partnership, or where one has a withholding tax income, they have to file business income by downloading an ITR form that has sections to capture the business income. From the form, the business income is declared, and expenses incurred to generate the revenue claimed to arrive at the net profit that is subject to the tax rates. If you have business income, get in touch with our tax experts to get your books done, verified and filed.

KRA Tax Penalties

Failure to file tax returns and late filing attract penalties. The Tax Procedures Act Sec 83, and the Income Tax Act outline the penalties, and a summary of the penalties is:

When a business is penalised, it cannot get a Tax Compliance Certificate, an important document that shows a taxpayer is compliant with the tax laws. The document is often requested by employers or some embassies for individuals and in the tendering process for businesses.

Important!: The KRA Tax Amnesty Program – a 100% Waiver on Penalties and Interest for a period up to Dec 2023 is coming to an end soon- June 2025, call our team to learn how to get started.

Wrap Up

The requirement to file KRA tax returns and the penalising of non-compliant taxpayers is anchored in Law. Taxpayers are required to file their income tax returns by 31 June every year for individuals and for corporates within 6 months after the end of their financial year.

It is important to engage a professional tax accountant and more a licensed a licensed KRA Tax Agent like us to guide and file the returns accordingly to avoid getting into problems with the tax man.
You can reach out to our team via the following methods:
Email: info@anzianoconsultants.com
Call/WhatsApp: +254706600875 | +254208400605
Physical. Office: Njengi House, Tom Mboya Street Nairobi- 2nd Floor RM1