'We are coming for you,' Why KRA has suspended nil tax filings

KRA Deputy Commissioner Taxpayers Services, Patience Njau. [Ronald Kipruto, Standard]   

The Kenya Revenue Authority (KRA) will reinstate nil tax filings after completing a data review aimed at expanding the tax base by converting nil filers, non-filers and zero filers into taxpayers.

Earlier this month,  KRA suspended nil return filings until the end of March, to allow it comb through multiple data sets to identify undeclared income.

KRA Deputy Commissioner for Taxpayer Services Patience Njau, on Friday, January 23, said data from withholding taxes, employment income, eTIMS records, financial transmissions, and customs systems will be used to generate pre-populated tax returns.

The pre-filled returns, she said, will enable the authority to accurately assess tax obligations before allowing taxpayers to submit nil returns.

“Between now and the end of March, you cannot file nil returns for your 2025 income,” Njau said. “Nil filing will be reopened once we have reviewed the data and confirmed that no transactions occurred during the year. This is meant to ensure that the tax burden is shared more fairly.”

The Taxpayer Deputy Commissioner averred that Kenya’s tax burden disproportionately falls on formally employed workers, while individuals earning rental income or subject to withholding tax often fall outside the tax net.

 “Out of about eight million who filed, only four million actually pay taxes,” she said. “So you can imagine in a country of roughly 50 million people, that is a highly skewed figure, even if we assume five million pay.”

She said KRA’s self-declaration process allows taxpayers to confirm their income details, with further assessments conducted where discrepancies are identified.

“The reason why we ask a taxpayer or a PIN holder to validate their employment income, even if we are receiving it from your employer, is for accountability. We don't want you to say that this is not what the employer deducted…we want you to confirm that this is actually what was deducted from you.”

Addressing concerns over data privacy, Njau said the taxman operates within the law and only uses information available in its systems and permitted under existing legislation.

Her remarks follow widespread online complaints from taxpayers and netizens who were unable to file returns following the suspension of nil filings.

The deadline to file returns for every financial year is June 30.