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Differences between tax amnesty and tax waiver and how to apply for the tax waiver

Comprehensive guide on how to apply for tax penalty waivers from KRA | Pulselive Kenya

Amos Robi

Kenyan taxpayers occasionally face penalties and interest due to delays in paying taxes or filing returns.

Fortunately, the Kenya Revenue Authority (KRA) offers a pathway to alleviate these financial burdens by applying tax waivers.

When taxpayers are unable to meet their tax obligations on time, they may apply to the Commissioner for the remission of <a data-link-role-code="open_new_tab" href="https://www.pulselive.co.ke/news/local/tax-cuts-refunds-and-other-details-you-should-know-about-new-affordable-housing-act/9s2dx9p">penalties and interest incurred as a result. </a>

However, it's crucial to note that waivers only apply to penalties and interest, not the principal tax amount, which must be settled in full.

It is also important to recognise that penalties and interest stemming from fraud or tax evasion are not eligible for waiver consideration.

<h3>Differences between tax waivers and tax amnesty</h3>

While tax waivers allow for the application of penalty and interest remission upon full payment of the principal tax, tax amnesty initiatives are periodic and targeted efforts aimed at specific objectives, often guaranteeing a percentage waiver of penalties and interest based on prescribed conditions.

Mark Mwithaga

READ: <a href="https://www.pulselive.co.ke/business/domestic/3-special-groups-kra-exempts-from-paying-income-tax-qualifications/wgkycq3">3 special groups exempted from paying income tax in Kenya [Qualifications]</a>

<h3>Qualifying for a waiver application</h3>

Before applying for a waiver, all principal taxes must be fully paid. Additionally, taxpayers must demonstrate compliance with other tax obligations, including timely filing and payment.

The applicant's past compliance record plays a significant role in the assessment of their waiver application.

For taxpayers using the iTax system, applications are submitted through their iTax profiles.

For assessments conducted before the implementation of iTax, manual applications should be presented at the <a data-link-role-code="open_new_tab" href="https://www.pulselive.co.ke/business/domestic/kra-clarifies-taxation-on-till-numbers-for-businesses/8r96s55">taxpayer's respective Tax Service Office</a> (TSO).

All applications must clearly state the reasons why the taxpayer should be considered for a waiver, accompanied by evidence supporting each reason.

READ: <a href="https://www.pulselive.co.ke/business/domestic/9-types-of-taxes-imposed-on-kenyas-fuel-as-cs-chirchir-warns-of-further-price-hikes/tpzd06b">9 types of taxes imposed on Kenya's fuel</a>

<h3>Supporting evidence requirements</h3>

The type of supporting evidence required depends on the mitigating grounds presented in the application.

<h3>Handling erroneous penalties and interest</h3>

Taxpayers can request the removal of erroneous penalties and interest by submitting applications to the Debt Office in their respective TSOs.

The application is reviewed, and if it meets the requirements, the erroneous penalties and interest are reversed by established procedures.

1. Tracking Progress Taxpayers can follow up on their waiver applications with the Debt Unit offices at their respective TSOs.

<h3>Receiving decision notifications</h3>

Upon processing a waiver application, KRA notifies taxpayers of the decision.

For iTax applications, notifications are sent via email to the taxpayer's registered address. For pre-iTax assessments, notifications are sent via postal mail, <a data-link-role-code="open_new_tab" href="https://www.pulselive.co.ke/business/how-to-pay-kra-taxes-through-government-pay-bill-number-222222/zmwlxwj">with scanned copies also emailed to the taxpayer.</a>

READ: <a href="https://www.pulselive.co.ke/business/domestic/how-kras-access-to-bank-ntsa-school-data-could-change-everything-for-kenyans/7j7ph2l">How KRA's access to bank, NTSA, school data could change everything for Kenyans</a>

If a waiver application is partially granted or declined, taxpayers must adhere to the decision.

Any amount not waived must be paid within the specified period outlined in the notification issued by KRA.

Comprehensive guide on how to apply for tax penalty waivers from KRA

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