The Kenya Revenue Authority (KRA) has been put under pressure to fast track refunds of taxpayers who in the process of meeting their tax obligations make excess payments.
- •KRA has a period of three months to ascertain that there was an overpayment of tax, after a formal application by the taxpayer.
- •The Finance Bill 2024 proposes that if KRA fails to refund the overpaid tax within six-months period, the amount due shall attract interest of one per cent for each month during which the amount remains unpaid.
- •The bill gives the taxpayers two options on how to access the refund once the taxman acknowledges excess payments were made.
“Where a taxpayer has overpaid a tax under any tax law, the taxpayer may apply to the Commissioner to offset the overpaid tax against the taxpayer’s outstanding tax debts and future tax liabilities; or for a refund of the overpaid tax within five years, or six months in the case of value added tax, after the date on which the tax was overpaid,” reads the Finance Bill 2024.
The bill also seeks to amend the due date for submission and payment of taxes. It states that if the date for submitting or lodging a tax return, application, notice, or other document, the payment of tax or taking any other action under a tax law falls on a Saturday, Sunday, or public holiday in Kenya, the due date shall be the previous working day.
The Finance Bill 2024 also highlights transactions which will require KRA Pin, which include registration of titles and stamping of instruments, approval of development plans and payment of water deposits, registration of motor vehicles, transfer of motor vehicles, licensing of motor vehicles, registration of business names, registration of companies.
It also includes underwriting of insurance policies, trade licensing, importation of goods and customs clearing and forwarding, payment of deposits for power connections, all contracts for the supply of goods and services to Government Ministries and public bodies, opening accounts with financial institutions and investment banks, registration and renewal of membership by professional bodies and other licensing agencies, registration of mobile cellular pay bill and till numbers by telecommunication operators, carrying out business over the internet or an electronic network including through a digital marketplace and registration of a trust.
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