Introduction
The Finance Act 2023 introduced a tax amnesty for interest and penalties on tax debt by
inserting Section 37E to the Tax Procedures Act, 2015.The Kenya Revenue Authority (KRA)
issued a public notice on 1 September 2023 regarding tax amnesty on interest and for
periods up to 31 December 2022. The tax amnesty will run from 1 September 2023 to 30
June 2024.
Application
The amnesty is applicable to:
- A person with penalties and interest but has no principal taxes owing for periods
up to 31st December 2022; and - A person who has principal tax accrued up to 31st December 2022 but pays the
outstanding principal tax debt by 30th June 2024.
How Tax Amnesty Works
The tax amnesty Programme is meant to help resident and non-resident (Individuals and
companies) taxpayers be tax compliant by writing off any interest and penalties that
may have accrued for previous years up to 31st December 2022.
Through the tax amnesty program, taxpayers who have already paid their principal taxes
will have any pending interest and penalties automatically waved.
Taxpayers with outstanding principal taxes will be required to pay in full before a waiver
of interest and penalties is granted. Under the amnesty program, taxpayers may make
full payment of the principal taxes or enter a payment plan and settle the taxes due in
installments. The payment plan agreement shall not extend beyond 30th June 2024. Any
penalties and interest relating to the principal tax under the tax amnesty period that
remains unpaid after 30th June 2024 shall not qualify for amnesty. Amnesty shall be
granted upon the payment of the final instalment as committed in the payment plan
agreement.
Conclusion
The tax amnesty programme is a win-win for both taxpayers and the Government.
Taxpayers can apply for waiver of penalties and interest, save money and regularize their
tax affairs. The government, through the KRA, will, on the other hand, hope to collect
more revenue.
We encourage taxpayers to take advantage of this opportunity and apply for the tax
amnesty programme and pay the principal tax before the deadline expires. Taxpayers
should consult the tax team for any queries on the amnesty programme.
Prepared by:
CPA Antony K Riungu
CPA-K, BBM, MBA
