KRA begins receiving voluntary tax disclosure applications


KRA office located at Times Towers in Nairobi
File photo of KRA headquarters located at Times Towers in Nairobi. PHOTO| COURTESY

In Summary

  • The tax man has begun dispersing notices to tax payers imploring them to take part in the initiative which makes known previously undisclosed tax liabilities.
  • The VTDP came into being through the 2020 Finance Act which sort to enhance revenue collection by allowing non-compliant tax payers to disclose their taxes without penalties and litigation.
  • Persons making full disclosures and payment in 2021 will receive full immunity from penalties and interest while the ratio of relief will be varied at the rate of 50 and 25 per cent in 2022 and 2023 respectively.

The Kenya Revenue Authority has activated its voluntary tax disclosure program (VTDP) as it moves to enhance revenue collection through enhanced compliance.

The tax man has begun dispersing notices to tax payers imploring them to take part in the initiative which makes known previously undisclosed tax liabilities.

“As part of our administrative actions, we have already dispatched notices to thousands of taxpayers asking them to take advantage of the VTDP by declaring and remitting their previously undeclared taxes. This notice is nondiscriminatory and purely targets taxpayers deemed to be non-compliant on our i-Tax platform,” said KRA’s Commissioner for Domestic Taxes Rispah Simiyu.

KRA has further set up audit teams at its tax payer offices to identify compliance risks, develop and implement compliance improvement levels.

The VTDP came into being through the 2020 Finance Act which sort to enhance revenue collection by allowing non-compliant tax payers to disclose their taxes without penalties and litigation.

The process does not however apply to tax payers already implicated in ongoing tax non-compliance suits.

Last month, KRA indicated it would waive all penalties and interest due to tax payers participating in the initiative this year.

The VTDP is a three year program ending in December 2023.

Persons making full disclosures and payment in 2021 will receive full immunity from penalties and interest while the ratio of relief will be varied at the rate of 50 and 25 per cent in 2022 and 2023 respectively.

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