Kenya revenue authorities formerly known as (KRA) has been one of the government agency programs in charge of collecting, accessing, and accounting for all taxes around the country, it started way back in 1995 by the national assembly. The Kenya revenue authorities headquarters is located at Times Tower, Haile Selassie Avenue in Kenya’s capital Nairobi.
In Kenya when one hears or comes across the name Kenya Revenue Authority (KRA), what automatically comes to mind immediately is tax. in other words KRA is mostly referred to as the taxman by Kenyans. it is also a facilitator of global trade.
Kenyans have always found themselves on the other side of the law most so students. Every individual and company in possession of a Personal Identification Number (PIN) should file their tax return at the end of the year with the collection agency which is the Kenya Revenue Authority.
Kenya operates a self-assessment tax regime where an individual or business voluntarily declares the income received during the year and settles the resultant tax liability if it exists. Where one did not accrue any income, then the law allows the taxpayer to file a nil return.
A return is a primary document a taxpayer uses to declare their taxable position to the Authority.
Despite Kenya Revenue Authority’s comprehensive support network country-wide, KRA reportedly has had many Kenyans not exercising this important duty of filing their tax returns. This is the case even with the late filing penalty being set at Sh20,000 for companies and Sh2,000 for individuals.
Campus students need to go ahead and file KRA Income Tax returns as Nil if unemployed. If you are studying and employed, you should file your income returns to avoid fines and penalties.
Filing of a nil return in simple terms communicates that the taxpayer did not receive any income within the year in question or that their income falls below the taxable income bracket in Kenya and therefore did not pay taxes during the year.
Should Students File KRA Income Tax Returns?
Cases of campus students failing to file their returns have been heard and reported country-wide, most of them assume they are not entitled to but they fail to understand that everyone with a KRA pin should file returns.
Tax returns are only filed for the year ended. For example, if you are filing your returns in 2021, they should be from 2020 January 1st to 2020 December 31st where every individual with a PIN has been required to file their income tax returns for every year of income by 30th June of the following year as provided in the tutorials below.
Step 1: Register with itax portal
Type https://itax.kra.go.ke/KRA-Portal/ and you be directed to the KRA portal where you will enter your KRA Pin or USER ID. Enter and log in with your iTax password. If you have forgotten your password, retrieve one using the „ FORGOT PASSWORD‟ option on the bottom right of the iTax portal page.
Step 2: On itax portal go to returns
After Login. You will be directed to a page that has a red top menu as shown below.
Place your cursor (mouse pointer) on the ‘RETURNS” page and a drop-down menu will appear. Below the drop-down menu, you will see “FILE NILL RETURNS.” For the unemployed that is where you are supposed to click and you will be directed to a page that looks like the one below.
Fill by entering:
- Tax obligation: Income Tax-Resident Individual
Then click Next and you be directed to a page like this below
- Wife Pin: (Leave blank if you don’t have one filing return)
- Return Period: 01/01/2018
- Return Period: 31/12/2018 (this section will fill itself automatically once you click the small calendar on the right)
Click Submit. On successful submission, the message below will be displayed:
Click download Returns Receipt to download. You are done after downloading.
With a raft of measures issued to the public by the revenue collection authority such as the introduction of iTax in 2015, the Integrated Tax Management System, aimed at simplifying the work of filing individuals returns presently filing returns it is still an uphill task for many. Probably because some of the basic concepts behind income tax filing are not clear.
- An internet-enabled device.
- P9 form from your employer.
- KRA PIN.
- iTax password.
A P9 is a form containing total income received in a year and may include the following depending on the structuring by the employer; basic salary, allowances and benefits, gross salary, pension contribution, PAYE charged, and personal relief entitlement. Below is an image of a standard P9.
Gross pay is the sum of your basic pay and any other taxable allowances and benefits received as a result of employment.
Pension contribution, Mortgage interest, and savings in a homeownership savings plan (HOSP) if any are deductible contributions. They are therefore deducted from your gross pay before arriving at the taxable income.
The deductible contributions are however subject to various conditions. Mortgage interest or owner-occupied interest on an amount borrowed for either purchase of premises or improvement of premises you occupy for residential purposes for example is deductible up to a maximum of Kshs. 25,000 per month (Kshs. 300,000 per annum).
With these few tax filing concepts, you are now ready to file your returns. It is important to start the filing process early so that in case you face any challenges that require KRA’s intervention, you have ample time to get it sorted out before the deadline.