TheKamams
Member
Kenyans living in Kenya or in Diaspora are required by Kenya Revenue Authority to file there annual returns yearly between 1st January and 30th June whether employed or not. Any person who is a holder of a KRA PIN is required not to fail to file returns as failure leads to a penalty of Ksh.2,000 every year you fail to.
Many tend to say that they do not know the process of filing returns. KRA advises every taxpayer to visit KRA Offices, KRA Huduma Centers desks or Online platform such as ITax Portal and KRA M-Service APP to be assisted in the process. But due to lack of time to visit the offices,here is a simple process on how to do your annual returns.
Kenyans in Diaspora are also required to file returns especially if they own KRA PIN. If you are earning a salary that comes from a compay in Kenya but sent you to offer services outside the country, you are therefore required to request for a P9 form from your employer as the earns have been accrued from a employment of a company or entity located in Kenya. Apart from PAYE, Kenyans in Diaspora should evaluate themselves to get to know if they are offering digital services in Kenya hence required to pay a tax called Digital Service Tax (DST) before 20th of every month.
We begin with Nil filers.Nil filers are those who have a PIN but are not employed or are employed but do not meet the taxation threshold of Ksh 24,000 that requires them to be deducted PAYE every month. Nil filers can easily use the newly introduced KRA M-Service App that can be downloaded from Apple and Google play store. This is the most efficient app to use. After signing up and login in,you go to to the Icon written NIL RETURNS,select your obligation which mostly is Income Tax-Resident Individual,Select Tax Return Period(the year eg 01/01/2020 to 31/12/2020) and then Submit.
Another alternative is use of KRA Itax Portal where you log in,go to Returns tab and from drop list select Nil Returns,select obligation followed by period then submit.
The second type of return filers are the employed taxpayer who has to use an Excel and then Upload to the system. The process is also simple,first log in to your portal or go to www.kra.go.ke then downloads and search for IT1 file and download it. If you're using your Itax Portal,go to Returns Tab, File Returns icon. Here you can downloaded the excel sheet. After downloading the excellent sheet you're required to enable Macros to enable the excell to auto calculate.
How to enable Macros simple illustration;
When the macros are enabled you start the filing process,
First fill basic information in the first page: Enter your PIN number, Type of Return( If not an amended should always be ORIGINAL) ,Return Period(Year of return). Fill other tabs where applicable.
Step 2: Fill in Employment details. Here enter your employers PIN Number always displayed on the P9 forms,Employers name,Gross pay and other relevant details if applicable to you,if you don't have things like mortgage deductions just key in zero(0) after filling the total gross pay.
This year due to Covid-19,on the Total Employment income,you will be required to Key in total gross paid and Pension contribution as per the P9 between January-March and between April-December.
Step 3. Details of PAYE
Here, you're required to key in employers PIN and name, the taxable income(salary) which is always Total Gross pay-Total pension contribution(E2).
Key in Tax payable on Taxable salary which is (Total Relief + Total PAYE deducted) then Total Amount deducted(PAYE). After you key in PAYE on column E make sure the total on column F is total Personal relief for the entire year.
Step 4.
This section is the final Tax computation section.Here you key in Total pension contribution and total personal relief(25,824) for the year at row 11.1 and 12.6 respectively.
Final confirm if your tax due is either 0.00 or as a positive or a negative figure. If positive counter check your keyed details as positive figures requires you to pay KRA the amount indicated there. Positive figures may results due to under deduction of PAYE or might have personal Insurance policies that you're required to feed into the excel in order to give a negative figure for you to claim 15% refund of the Premium contributed that year.
If the tax due is negative,validate the excell for uploading but later on liase with KRA for a refund. A negative may occur due to over deduction of PAYE, shifting of salary that year(increment) or wrong keying of Tax payable on taxable salary and PAYE.
After you have confirmed your tax due is occur,validate the excell into a zip file and go back to your Itax portal,select obligation,return obligation,return type(Original),return period and submit. After submission,you are good to go and wait till the following filing period.
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