The Kenya Revenue Authority (KRA) has reminded Kenyans who have not yet filed their taxes to do so before the deadline set for today, February 20, 2025. The taxman issued a warning that those who fail to submit their returns and pay their taxes by midnight will face hefty penalties.
In an official notice released on Thursday afternoon, KRA outlined five different taxes that must be filed and paid before the deadline. One of these is the Value Added Tax (VAT), an indirect tax applied to goods and services consumed in Kenya. This tax is paid by the final consumer but is collected by businesses and remitted to the government.
According to KRA, any individual or business that supplies or expects to supply taxable goods or services valued at Ksh5 million or more per year must register for VAT and remit payments at a rate of 16%. Failure to comply attracts severe financial penalties.
KRA also urged taxpayers to submit their Turnover Tax (TOT) and Monthly Rental Income (MRI) tax, both of which are due today. Turnover Tax (TOT) applies to small businesses with an annual turnover ranging between Ksh1 million and Ksh25 million. As per the Finance Act 2023, which came into effect on July 1, 2023, Turnover Tax is charged at 3% of gross sales and must be paid by the 20th of each month.
Similarly, property owners earning rental income are required to file and pay the Monthly Rental Income (MRI) tax by today. This tax is imposed on landlords who earn rental income from residential properties.
In addition to these, KRA reminded Kenyans of two other taxes whose deadlines are also approaching – the Digital Service Tax (DST) and Value Added Tax (VAT) on Digital Marketplace Supply. Digital Service Tax (DST) applies to businesses that earn income from digital platforms, including streaming services, online advertising, and e-commerce.
Kenyans who need to file and pay any of these taxes were directed to the KRA iTax portal (itax.kra.go.ke/KRA-Portal), where they can log in and complete their tax obligations before the deadline.
“Today is February 20, 2025, and the deadline to file and pay the following taxes: Value Added Tax (VAT), Turnover Tax (TOT), Monthly Rental Income Tax (MRI), Digital Service Tax (DST), and Value Added Tax on Digital Marketplace Supply. Avoid penalties by filing and paying on time! Get started via itax.kra.go.ke/KRA-Portal,” KRA stated.
For those who fail to comply, KRA warned of strict penalties. Anyone who fails to remit VAT will be fined Ksh10,000 or 5% of the tax due, whichever amount is higher. Businesses that do not pay Turnover Tax face similar penalties.
Meanwhile, those who fail to remit the Digital Service Tax (DST) will be charged 1.5% of the gross transaction value as a penalty. This tax applies to individuals and businesses that provide digital services, such as online advertising, content streaming, and digital marketplace transactions.
KRA has urged all taxpayers to comply with the set regulations to avoid unnecessary penalties and legal consequences.
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