12 deadly offenses that will earn you a fine from KRA

The deadline for filing tax returns in Kenya is 30 June. As the deadline nears, the Kenya Revenue Authority (KRA), has increased the penalty for failing to meet the deadline. 

“Penalty for late filling of tax returns on employment is 5% or KSh 10,000 whichever is higher. On turnover tax, penalty is KSh 5,000, any other case is 5% of tax due or KSh 20,000. For failure to submit a tax document as required, one will be charged KSh 1,000 per day, maximum KSh 50,000,” said Wanja Wang’ondu, Acting assistant manager domestic taxes Nairobi region.

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For not keeping proper records, the penalty is either 10% of tax or KSh 100,000, whichever is higher. Interest chargeable is 1% per month on principal tax. For offences which no specific penalty is provided, a general penalty of a fine not exceeding KSh 500,000 or imprisonment for a term not exceeding three years, or both, is applicable. “If someone want to get a tax compliance certificate today, we won’t issue it until they first pay the penalty for 2016,” said Wang’ondu.

12 offenses that will attract a fine

All registered taxpayers are required by Law to comply. The VAT Act lists certain offences and respective penalties.

1. Failure to register – fine not exceeding KSh 20,000 or imprisonment for a term not exceeding six months or both.

2. Enforced registration – default penalty of KSH 100,000.

3. Failure to submit a return on or before the due date or submitting a payment return without paying the tax due – default penalty of KSh 10, 000 or 5% of the tax due whichever is the higher and additional interest of 2% per month compounded.

4. Failure to keep proper records – a default penalty of between KSh10, 000 to KSh 200, 000.

5. Fraudulent Accounting – a fine not exceeding KSh 400, 000 or double the tax evaded whichever is greater or imprisonment for a term not exceeding three (3) years or both.

6. Failure to issue a Tax Invoice – an automatic penalty of not less than KSh 10, 000 but not exceeding KSh 100,000.

7. Hindrance or obstruction of authorised officers.

8. Uttering false statements.

9. Charging tax when not registered – tax shown on such invoice is due to the Commissioner within seven (7) days.

10. Failure to display a certificate of registration – a default penalty of KSh 20, 000 and a fine not exceeding KSh 200, 000 or imprisonment for a term not exceeding two (2) years or both.

11. Failure to comply with VAT regulations

12. Failure to pay tax and late payment

Useful information

KRA Call Centre
Tel:  +254 (020) 4999 999

Mobile number:  +254 (0711) 099 999

Email: callcentre@kra.go.ke

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