The penalty for failing to file tax returns was initially Sh.20,000 per year but this was later on revised to Sh.2000 per year by KRA. Like many Kenyans who did not see the need to file tax returns when the KRA itax system was introduced, I never filed my Tax returns for the first two years since the introduction of itax system in 2015.
It was until 2018 that I walked into the KRA offices to file my tax. That’s when the reality of the burden of failing to file tax returns dawned on me after I was slapped with a fine of Sh.40,000 for failing to disclose my tax returns for the year 2015 and 2016. For each year I failed to file my returns I was to pay a penalty of Sh.20,000. I wondered how unfair KRA was despite the fact that I was unemployed. But as they say, ignorance is not a defense.
I inquired for a KRA waiver for penalties and interests application process and I was told to go write an official letter detailing why I was not able to file tax returns for two consecutive years. Supporting documents were to accompany the letter as proof that indeed you were unable to file your returns.
As I had stated before, ignorance is not a defense and therefore there was no such proof in the name of “I DIDN’T KNOW”.
For the rest of the years I wondered how I will get through the burden of the Sh.40,000 penalty until late 2019 when I discovered a way to get through it.
While going through the itax portal I realized there is a section for debt and enforcement where one could request for waiver of penalties and interests through the online system. I decided to give it a try wrote a letter as to why I was unable to file my tax returns for the two years and uploaded it to the system.
After some few months, I decided to apply for Tax Compliance Certificate throught the itax platform but my application was unsuccessful. I had penalties to settle first. In their response, I received a letter from KRA on my email stating the same.
Rejection of Application for Tax Compliance Certificate
We regret to inform you that your Application for Tax Compliance Certificate dated 09/01/2020 with Acknowledgement No. KRA202000420— has been rejected.
Below are the reasons for rejection : you have pending tax arrears. Kindly visit the nearest kRA station for further facilitation.
Domestic Tax Department
Kenya Revenue Authority
The above letter was an obvious indication that either my waiver application had been rejected or was still pending.
Down but not out, I decided to try my luck again six months later, I applied for KRA Clearance Certificate on the Itax platform and to my surprise, my request was approved. A KRA tax compliance was sent to my email.
“This is to confirm that XXXXX XXXX XXX, Personal Identification Number AXXXXXXXXXB has filed relevant tax returns and paid taxes due as provided by Law.
This Certificate will be valid for twelve (12) months up to XX/06/2021.” The Tax Compliance Certificate Read.
I felt much relieved. Finally my penalties and interests waiver request had been approved. I was now able to get the much awaited Tax Compliance certificate.
The Secrete Of Getting KRA Penalties Waiver
- When applying for the waiver, try to give evidence indicating that it was beyond your ability to access the Itax services at the required time. As long as your letter is convincing you do not need to attach any supporting evidence. But if you have any document to back up your claim, it is advisable to attach it.
- Be patient after you have made your waiver application. For my case, it took almost a year before I could get my clearance certificate.
- Your application for Tax Compliance Certificate may be rejected long after you applied for the waiver, that does not automatically mean your waiver request was rejected. Always keep trying.
Penalties and Interests Waiver Application Process
- Login to your KRA itax portal with your KRA PIN and Password
- Select ‘Debt and Enforcement’ option
- Select ‘penalties and interests’ option
- You will be asked to attach a file containing your waiver application
- Submit your application
KRA Tax Compliance Certificate Application Process
To apply for Tax compliance certificate;
- Log into KRA itax portal with your KRA PIN number and password. If you are yet to migrate your KRA PIN to the Itax system do so before you can proceed.
- On your dashboard, head to ‘Certificates’
- Select the ’Apply for Tax Compliance Certificate’ option