All You Need to Know About KRA’s Tax Amnesty as Deadline Approaches
In the year 2023, the government implemented the Tax Amnesty Program via the Finance Act, aiming to forgive accumulated penalties for taxpayers.
The cutoff date set for June 2024 has been emphasized, and taxpayers are encouraged to make the most of the available opportunity.
According to the directives issued by the Kenya Revenue Authority (KRA), the amnesty applies to individuals who have incurred penalties but do not have any outstanding principal taxes for periods until December 31, 2022.
This also pertains to individuals with accumulated principal tax until December 31, 2022, who settle their outstanding principal tax obligations by June 30, 2024.
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“All taxpayers who do not have principal tax due for periods up to December 31 2022 but have penalties and interest due shall qualify for the tax amnesty. The amnesty under this category shall be automatic and taxpayers will not be required to apply,” read part of the guidelines.
Furthermore, individuals with tax obligations currently undergoing dispute proceedings will be eligible for the amnesty, provided they satisfy the specified conditions.
Nevertheless, the Kenya Revenue Authority (KRA) specifies that certain items are exempt from the program, such as interest and penalties levied according to Section 85 of the Tax Procedures Act 2015.
“If the Commissioner has applied a tax avoidance provision in assessing a taxpayer, the taxpayer is liable for a tax avoidance penalty equal to double the amount of the tax that would have been avoided but for the application of the tax avoidance provision” reads part of the Act.
Furthermore, individuals with penalties and interest associated with tax liabilities accumulated after December 31, 2022, will not be eligible for the amnesty.
How to Apply on iTax
This involves a six-stage procedure that commences with the applicant accessing iTax by logging in.
The subsequent action involves navigating to the Debt and Enforcement section and choosing the iTax Amnesty Application.
Choose the appropriate tax responsibilities in section A, and the relevant information regarding the amnesty for that particular obligation will be automatically filled in.
If undisputed click ‘add all’ for all obligations and move on to section B.
Section B suggests the quantity and frequency of payments. The system will subsequently calculate the installment amount. Please click to accept the terms and conditions, and then click once more to submit, concluding the process.
The iTax system will produce an acknowledgment for the amnesty application, including information on the granted amnesty and the associated payment schedule.
In the fifth step, you will be required to generate the payment slip for the respective tax obligation and tax period through iTax and proceed to pay through a bank transfer or the consolidated Paybill number 222222.
Finally, once the payment is received, the iTax system will vacate respective penalties and interest accrued for the period and an amnesty certificate will be issued.
All You Need to Know About KRA’s Tax Amnesty as Deadline Approaches