Tax Administrative Penalties
Ref: Tax procedures act 2015
| Offence | Penalty |
|---|---|
| Failure to register or de-register for tax purposes where required to do so by a tax law | Penalty of KES 100,000 per month or part thereof subject to a cap of KES 1million |
| Failure to keep, retain or maintain proper documents as required by a tax legislation | Penalty equal to 10% of the amount of tax payable subject to a minimum of KES 100,000 |
| Late submission of PAYE returns | Penalty equal to 25% of the tax due or KES 10,000; whichever is higher |
| Late filing of any other tax return | Penalty of 5% of the amount of tax payable under the return subject to a minimum of KES 2,000 for individuals and Sh.20,000 for corporates KES 1,000 per month for turnover tax |
| Failure to file any other document, other than a tax return | Penalty of KES 1,000 per day subject to a maximum penalty of KES 50,000 |
| Tax avoidance | Penalty equal to 200% of the amount avoided by a taxpayer This penalty is not eligible for waiver by the Commissioner or the Cabinet Secretary |
| Fraudulent claim for a refund of tax | Penalty of 200% the amount of the claim under all tax laws |
| Offenses committed by KRA officers or persons required to act on Commissioner instructions | Fine not exceeding KES 2 million or to imprisonment for a term not exceeding 5years or to both |
| Offenses committed by tax agents such as participating in creation of tax avoidance or evasion schemes; acting as a tax agent illegally Fraudulent act of omission and commission in respect of a tax period | Fine equal to 200% of the amount of tax evaded or a fine of KES 5 million whichever is higher or to imprisonment for a term not exceeding 5 years, or to both Fine not exceeding KES 10 Million or 200% of the amount of tax evaded, whichever is higher, or imp |
| Failure to appear before the commissioner when required when the Commissioner is satisfied that the person committed an offense | KES10,000 in the case of an individual and KES 100,000 in any other case. |
| Late payment penalty- Individual return | 5% of the tax due and a late payment of 1% per month on the unpaid tax until the tax is paid in full |
| Late payment penalty- corporates | Additional 20% of tax involved |
| Late filing of withholding tax return | Either 5% of the tax payable or twenty thousand shillings, whichever is higher |
| Failure to deduct or pay Withholding Tax | 10% of the amount of the tax involved, up to a maximum of Kshs. 1 million |
| Failure to pay Stamp Duty | Additional 5% of the payable duty for every quarter, from the date of the Instrument |
| Failure to pay Excise Duty or VAT | Whichever is greater of, 5% of the amount of the tax due or Ksh. 10,000 |
| KRA PIN-related offense | Ksh. 2,000 per offence |
