Kenya Tax Filing Guide

iTax — Kenya's Online Tax Platform

The Kenya Revenue Authority (KRA) operates a fully online tax filing system called iTax (https://itax.kra.go.ke). All tax returns — including PAYE, VAT, income tax, withholding tax, and CGT — are filed through iTax. Taxpayers must register on iTax using their KRA Personal Identification Number (PIN). The platform supports online payment via M-Pesa, bank transfer, or card. iTax is mandatory for all taxpayers; paper filing is only available in exceptional circumstances with KRA approval. Taxpayers can file their returns directly or authorise a tax agent (registered with KRA) to file on their behalf.

Annual Income Tax Return — 30 June Deadline

All individuals with income subject to tax must file an annual income tax return by 30 June following the tax year (1 January to 31 December). The return is filed through iTax using the relevant return form:

• Individuals (PAYE only): Simplified return (Form P1) — employees confirm their income, tax deducted, and claim reliefs and deductions.
• Individuals (multiple income sources): Full return (Form ITR) — includes business income, rental income, investment income, and all deductions.
• Companies: Corporate income tax return (Form CIT) — due within 6 months of the accounting period end.

Even employees whose tax is fully withheld must file a return — the obligation applies to all registered taxpayers. Failure to file blocks the taxpayer from accessing KRA services including iTax itself.

Monthly PAYE Returns

Employers must file a monthly PAYE return via iTax by the 9th of the following month. The return declares gross salaries, taxable benefits, PAYE deducted, NSSF contributions, AHL contributions, and SHA contributions. Payment must accompany the return. Late filing attracts a penalty of KES 10,000 or 5% of the tax due. Late payment attracts interest at 1% per month. Employers with nil returns (no employees or no salaries paid) must still file a nil return.

Instalment Tax — 4 Quarterly Payments

Businesses (self-employed individuals and companies) must pay instalment tax in advance. The instalment tax is based on the estimated current year's tax liability or the prior year's liability. The payment schedule is:

• 1st instalment: Due 20 April (25% of estimated tax)
• 2nd instalment: Due 20 June (25%)
• 3rd instalment: Due 20 September (25%)
• 4th instalment: Due 20 December (25%)

The final tax liability is calculated in the annual return, and the difference between total instalments and the actual liability is settled (pay the balance or claim a refund). Late payment of instalment tax attracts interest at 1% per month on the shortfall.

Penalties and Interest

KRA imposes the following penalties for non-compliance:

• Late filing: KES 10,000 or 5% of the tax due (whichever is higher)
• Late payment: Interest at 1% per month on the unpaid amount
• Failure to register for VAT: KES 50,000 plus 5% per month
• Non-filing for 3+ years: KRA may enforce collection through agency notices to banks, employers, and third-party debtors
• Tax evasion: Penalty of up to 100% of the tax evaded plus criminal prosecution with potential imprisonment

KRA PIN Registration

Every taxpayer (individual or company) must obtain a KRA Personal Identification Number (PIN). The PIN is a unique 11-digit identifier required for all tax transactions, including filing returns, paying tax, issuing invoices, and registering property transfers. Individuals register online via iTax or at any KRA office. Companies register at the time of incorporation through the eCitizen platform. The PIN must be included on all tax returns, invoices, and correspondence with KRA.

Record-Keeping Requirements

Taxpayers must retain accounting records, invoices, and supporting documents for at least 5 years from the end of the tax year. Companies must retain audited financial statements. KRA may request these documents during a tax audit. Electronic records are acceptable if they are readily accessible and printable. Failure to maintain proper records may result in KRA estimating the tax liability using best judgement, which may be unfavourable to the taxpayer.

FAQs

Can I file my tax return after 30 June?

Yes, but late filing penalties will apply. The penalty is KES 10,000 or 5% of tax due (whichever is higher). Interest on unpaid tax accrues at 1% per month from the original due date.

How do I check my tax compliance status?

Log in to iTax and check your compliance certificate. KRA issues a tax compliance certificate (TCC) which is valid for 12 months and is required for government tenders, property transfers, and visa applications.

How is a tax refund processed?

If instalment tax or withholding tax exceeds the final liability, the excess is refundable through iTax. Refunds are typically processed within 30–90 days. KRA may audit the return before processing the refund.

Disclaimer

This guide provides general information about Kenyan tax filing for the 2026 tax year. Tax laws and rates may change. Always consult with a qualified Kenyan tax advisor or the Kenya Revenue Authority for advice specific to your situation. InvestmentKit does not provide tax advice.