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How to File KRA Returns (KE)

By
Workpay

How to File KRA Returns (KE)

By
Workpay
|
May 25, 2022
8 min read

How to File KRA Returns 

The Kenyan taxman, i.e., the Kenya Revenue Authority (KRA), requires everyone who is a registered taxpayer and has acquired a KRA pin with them to file their returns every financial year. Non-resident individuals working with a Kenyan employee or a permanent establishment in Kenya are subject to income tax rates; thus, they must file returns in Kenya. 

Filing KRA returns is not as complicated as it seems. Here is a simple guide on filing KRA returns (employment income and nil returns).

What Do You Need to File KRA Returns Successfully? 

To file your KRA returns, you'll need three critical requirements for a successful process. They include: 

  1. KRA Pin 
  2. iTax login credentials 
  3. The Internet helps access the KRA's website (portal) or iTax mobile app and your email. 

A Step by Step Procedure

1. Visit KRA's website

The first step is to access KRA's official website, where you'll find the iTax portal through a browser.

2. Log in.

Once you access the portal section, you'll log in (enter PIN/User ID). 

You'll fill in your KRA pin and click "Continue."

Then fill in your password, and a security stamp will appear (answer the presented arithmetic sum on the screen).

Note: if you've forgotten your password, click "Forgot Password" to retrieve it via email. 

3. Visit the Return Menu.

Now that you’ve already logged in to your iTax account visit the return menu on the portal. 

Then select "Individual Tax Return (ITR) only."  

You’ll see some mandatory details, which require filling in and confirming. You should also select “Yes” to “Do you have employment income?”

Click “Next” to move to the next page. 

4. Fill in parts marked with a (*) and answer questions asked appropriately.

  • After clicking “Next,” you’ll see a page with “Section A” to “Section T”.

          Start by filling out Part 1 of Section A, "Basic Information”. Note that a section might lead you to another section. You have to fill in the asked details appropriately; such details will ask about your mortgage, car provided by an employer, insurance policy, foreign employment etc. 

  • Then click "Next," and you’ll automatically access Section F, named “Details of Employment." The system will have already filled in those details, but you must counter-check them.
  • Click “Next” to access “Section M”, which is “Details of PAYE Deducted at Source from Salary." The system will have already filled in those details, but you must counter-check them to see if they match your P9 form. 
  • Click “Next” to access “Section Q," which is “Details of Income Paid in Advance." If you’ve made any payments within that financial year, you’ll have to fill in the outline sections with the correct details. However, if there are no payments, skip the section and proceed. 
  • Click “Next” to access “Section T," which is “Tax Computation." It’s the last section, and the system has already automatically prefilled it. However, there are a few things you’ll add manually (if needed), such as “Defined Pension Contribution” and “Personal Relief," as outlined on your P9 form. 

5.Submission 

After finishing all of the above steps up to “Section T”, you’ll see a “Submit” button on the screen. Click “OK” to confirm you want to submit the filled data. 

Finally, you get an instant notification “Return Receipt Generated” that outlines your successful submission. 

6. Download KRA Returns Receipt

You can download a return receipt (it has a downloadable link). Additionally, you’ll get an email highlighting that your returns for that particular financial year have been submitted successfully. 

How to File NIL KRA Returns (Step by Step Procedure) 

Note: If you’re registered with KRA but not under employment income, you should file Nil Returns. It’s pretty simple, as outlined below. 

1.Visit KRA's website. 

First, you need to access your KRA portal through their website. You may also access it through KRA’s mobile app.

2.Login 

You should then log in (Enter PIN/User ID) to your portal (on the website or using the app). Add your password and solve the arithmetic sum that appears before clicking “Log in”. 

3.Visit Return Menu 

Once you’ve accessed your portal, click and select “File Nil Returns”.

4.Select Tax Obligation 

Select the type of tax obligation, for instance, an individual. You’ll also note that the “Type and Taxpayer pin” is automatically pre-filled. 

Then click the “Next” button.

5.Fill out the Income Tax Resident Individual Nil e-Return form. 

In this section, you’ll need to enter the “Return Period From” and “Return Period To”. You may avoid filling in the "wife PIN” slot. 

Now, click “Submit” and confirm "Yes" that you want to submit a NIL return. 

6.Download KRA Returns Receipt 

After submitting your NIL returns, you will get a confirmation that the submission was successful, and an acknowledgement number will be generated. 

You may also download the NIL return receipt. 

Important Note:
Businesses or other parties operating on terms such as limited company, sole proprietor or partnership could have additional tax obligations such as Excise Duty, Value Added Tax (VAT), and Pay as you earn (PAYE). Most importantly, they should file returns for such types of taxes as KRA requires. Please check out KRA’s requirements on different kinds of taxes as outlined on their website

What is the Penalty for Not Filing KRA Returns in Kenya? 

Individuals, businesses, firms or companies are subject to penalties and interest for not filing, or late filing of their annual or monthly returns as the Kenya Revenue Authority (KRA) requires. 

Individual taxpayers are subject to a penalty of Ksh. 2,000 or 5% of the tax due for late filing returns. Non-individuals are subject to a fine of Ksh. 20,000 or 5% of the tax owing for the offence. 

Other offences include late filing of income tax for company/partnership, VAT, MRI withholding rental income tax etc. Each violation attracts a different penalty, as KRA outlines on their web page (Offences and Penalties). Here is a reference.

Final Thoughts 

Filing your KRA returns is essential for individuals and firms. Late filing attracts severe penalties and unnecessary interest. Most importantly, the process is super simple, and you can do it on your phone or computer as long as you've got access to an internet connection. 

If you’re an employer struggling with tax compliance issues while paying your employees, Workpay is your ideal partner in payroll processing and compliance issues. 

In need of a HR and Payroll software?

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