What are tax returns?
Tax returns refer to a declaration of income earned by an individual, business or company within a particular financial period. This statement is used by tax authorities to assess liability for tax.
Who is obligated to file tax returns in Kenya?
Every registered taxpayer in Kenya with a KRA Personal Identification Number (PIN) is obligated to file tax returns every financial year. The iTax system allows for the filing of the different type of KRA returns such as Income tax related to the resident individual, corporates, partnership, and indirect tax such as VAT and Excise duty. Based on your tax obligation, you need to choose the right type of iTax returns and file. Filing KRA tax returns on iTax has never been simpler and easier.
Who is required to file nil returns?
Those who have no business, gainful employment, or do not have tax data for the return period under review must file nil KRA tax returns.
How do you file nil kra returns from the iTAX website?
- Navigate to the KRA iTAX website
The first step in filing your returns is logging into your account on the KRA iTAX online portal. You will need your KRA PIN and iTAX password to log into the portal.
- Select the file Returns tab
Select File Nil Returns from the drop-down menu.
- Choose the nil return form
Select self in the type of nil e-return segment. It will automatically fill your KRA PIN number and Income Tax Resident in the tax obligation section. Click Next to advance.
- Fill The Income Tax Resident Individual Nil e-Return Form
This section lets you select the financial year in review also referred to as the return period. In Kenya, we usually file the return of the previous year by the 30th of June. Because we are filing KRA Nil Returns for the previous year 2021, ideally our return period will start from 01/01/2021 to 31/12/2021. This will automatically autofill itself. Click on the submit button to proceed.
- Download KRA Returns Acknowledgement Receipt
After successfully filing your KRA Nil returns, the system will generate a return receipt with an acknowledgment number. Download the returns receipt and print it. Printing the KRA e-Return Acknowledgement Receipt is the ultimate indication that you have effectively filed the KRA Nil Returns.
What will happen if I don’t file my nil KRA returns?
According to the 2018 Finance Act, you are liable to a penalty of ksh2000 for the failure of filing your KRA nil returns. Avoid the last-minute hassle and file your tax returns before the June 30th deadline. There are no extensions to this deadline so get to it now and avoid the Kshs. 2000 penalty.