How to File KRA Returns on Your Income in Kenya 

The Kenyan tax landscape has undergone significant transformations in recent years, with the innovative iTax platform streamlining the process of filing tax returns for individuals and businesses. This shift from traditional methods to a technologically advanced system has made life easier for countless Kenyans. In the past, the Kenya Revenue Authority (KRA) relied on the TSW taxpayer software and the Integrated Tax Management System (ITMS) for tax-related matters. However, with the advent of iTax, a new era of efficient tax administration has emerged, offering taxpayers a more accessible and more convenient way to file KRA returns on their income.

Key Takeaways

1. The introduction of iTax has streamlined tax filing in Kenya, benefiting individuals and businesses.
2. The iTax platform started operating in 2014, allowing taxpayers to file and pay taxes online.
3. The iTax system facilitates the online filing of KRA returns, offering convenience and efficiency.
4. Key requirements for online filing of KRA returns include employer information, financial statements, and relevant documents.
5. Employees can file KRA returns using the PAYE online portal, ensuring accurate entry of employment details and deductions.
6. An alternative approach involves downloading an Excel workbook, populating details, and uploading it through iTax.
7. Filing nil returns on iTax is straightforward and beneficial for individuals with no income to declare.
8. Businesses can file returns on iTax using their company credentials and providing accurate financial information.

The Evolution of iTax

The iTax platform was inaugurated in 2014, marking a significant milestone in Kenya's tax history. This online platform revolutionized tax filing, enabling Kenyan taxpayers to file and pay their taxes online regardless of their tax category. This innovation has significantly simplified the tax filing process, particularly in the income section, which has become the most widely utilized feature of iTax. The user-friendly interface and straightforward process have contributed to the platform's popularity among Kenyans.

Requirements for Online KRA Returns Filing

Filing KRA returns online through the iTax system has become remarkably accessible for individual taxpayers and agents. To make the most of this streamlined process, specific prerequisites must be met:

1. Employer Information for Employees: If employed, ensure you have your employer's KRA PIN and other pertinent information. The P9 form, which includes essential details required for tax filing, should be provided by your employer.
2. Business Financial Statements: Having your financial statements on hand is crucial for business owners. These statements aid in accurately reporting your business's income and expenses.
3. Additional Documentation: Keep other relevant documents readily available, such as mortgage interest certificates, underwriter's PIN, insurance premium certificates, withholding tax certificates, and any other documents related to claims for deductions or income.

Filing KRA Returns for Employees

Suppose you are an employee without additional business income. In that case, the KRA online PAYE returns portal is your go-to tool for filing taxes. Here's how to do it:

1. Access the iTax Portal: Visit the official iTax portal and log in using your credentials.
2. Navigate to the Returns Menu: Once logged in, go to the returns menu and select "ITR for Employment Income Only."
3. Provide Employment Details: Fill in your employment details, confirm the accuracy of your gross pay and allowances, and ensure proper entry of your employer's PIN.
4. Check PAYE Deductions: Verify that the PAYE deductions in section M are accurate.
5. Enter Payment Data: Include any payment data before proceeding to section T for tax computation.
6. Submit and Download: Once you're confident in the accuracy of your entries, submit the form and download the e-return acknowledgment receipt.

Alternative Approach for Filing KRA Returns

For those who prefer an alternative approach, consider the following steps:

1. Download Excel Workbook: Log in to the iTax portal, download the Excel workbook, and populate the required details.
2. Validate and Upload: After validating the data, upload the Excel sheet and submit it through the iTax platform.

Filing Nil Returns on iTax.

For individuals who have no income to declare in a given fiscal year, filing Nil returns through iTax is a simple process:

1. Visit the Official Website: Login to the official KRA website using your PIN and password.
2. File Nil Returns: Access the returns menu and select the "File Nil Returns" option.
3. Provide Relevant Details: Choose the appropriate taxation and tax obligation type and submit the form.

Filing Returns for Companies

For businesses, the process of filing returns is equally straightforward:

1. Access Your Company's iTax Profile: Log in to the iTax portal using your credentials.
2. File Returns: Click the "File Returns" option under the returns drop-down list.
3. Download the Workbook: Download the Excel workbook for your company's income and populate the relevant details.
4. Validate and Upload: Validate the data, upload the form on the iTax platform, and receive an acknowledgment receipt.

READ ALSO: How to Calculate Tax Payable on Taxable Salary in Kenya

Conclusion

The iTax platform has transformed the landscape of tax administration in Kenya, offering a user-friendly and efficient solution for filing KRA returns. From employees to business owners, taxpayers can now complete their filing process efficiently, thanks to the streamlined processes and accessible online portal. Whether you have a primary income source or manage a company's financials, iTax provides a versatile platform that caters to various tax obligations. If you fulfill your tax responsibilities, you can confidently navigate the iTax platform to file your returns and contribute to the country's revenue system.

FAQs

1. Who is required to file KRA returns on the iTax platform? All Kenyan citizens aged 18 and above must file returns on the iTax platform, regardless of their primary income source or employment status.
2. What does it mean to file nil returns? Filing nil returns applies to individuals or businesses with no income to declare in a fiscal year. It allows them to fulfill their tax obligations even with no taxable income.
3. Can businesses file KRA returns through the iTax platform? Businesses with a Personal Identification Number (PIN) obtained from KRA must file returns on the iTax platform. The process varies based on the type of business and its financial statements.
4. Is there a deadline for filing KRA returns on iTax? Yes, the deadline for filing KRA returns on the iTax platform is between January 1 and June 30 of the following year. For instance, returns for the tax period 01/01/2023 - 31/12/2023 should be filed on or before June 30, 2024.
5. Can individuals file their tax returns using the PAYE online portal? Yes, employed individuals with no additional business income can utilize the KRA online PAYE returns portal to file their taxes. They need to provide accurate employment details and verify their deductions.
6. What are the benefits of using the iTax platform for tax filing? The iTax platform offers the convenience of online tax filing, reducing the need for physical visits to KRA branches or Huduma Centers. It provides a user-friendly interface and streamlines the tax administration process for individuals and businesses alike.