General Taxation

1. What services does Mwirigi & Co. Tax Consultants LLP offer?

   • We provide a range of services including Tax Compliance, Tax Advisory, Bookkeeping & Payroll Support, Audit & Risk Review, Representation Services, Training Workshops, Alternative Dispute Resolution (ADR), and Tax Planning.

2. Do you assist with both individual and corporate tax matters?

   • Yes, our services cater to both individual taxpayers and corporate entities.

3. How can I schedule a consultation?

   • You can schedule a consultation by contacting us through our website’s contact form, email, or phone.

4. What documents should I bring for a tax consultation?

   • Please bring your KRA PIN, previous tax returns, financial statements, and any relevant correspondence from tax authorities.

5. Do you offer services outside Nairobi?

   • Yes, we provide services to clients across Kenya and can arrange virtual consultations as needed.

Tax Compliance and Filing

6. Am I required to file a tax return if I have no income?

   • Yes, individuals with an active KRA PIN must file a NIL return if they have no income during the tax period.

7. How do I file a tax return on iTax?

   • Log in to your iTax account, navigate to the ‘Returns’ section, select the appropriate return, fill in the required information, and submit.

8. Can I amend a tax return after submission?

   • Yes, you can file an amended return through your iTax account to correct any errors.

9. What is the penalty for late filing of tax returns?

   • Late filing attracts a penalty of Ksh. 20,000 or 5% of the tax due, whichever is higher, plus interest.

10. How can I obtain a Tax Compliance Certificate (TCC)?

    • Apply for a TCC through your iTax account. The application will be reviewed, and if approved, the certificate will be issued electronically.

Withholding Tax and PAYE

11. What is Withholding Tax (WHT)?

    • WHT is a tax deducted at source on specific payments such as professional fees, dividends, and interest, which is then remitted to KRA.

12. Is WHT a final tax?

    • For non-residents, WHT is typically a final tax. For residents, it may be a credit against their tax liability.

13. What is PAYE and who is responsible for it?

    • Pay As You Earn (PAYE) is a method of collecting income tax from employees. Employers are responsible for deducting and remitting PAYE to KRA.

14. What are the penalties for failing to remit WHT or PAYE?

    • Failure to remit attracts penalties and interest, including a 5% penalty and 1% interest per month on the unpaid tax.

Value Added Tax (VAT)

15. Who is required to register for VAT?

    • Businesses with an annual turnover exceeding Ksh. 5 million are required to register for VAT.

16. How do I file VAT returns?

    • VAT returns are filed monthly through the iTax portal by the 20th of the following month.

17. Can I claim VAT on purchases without a supplier’s PIN?

    • No, a valid tax invoice with the supplier’s PIN is required to claim input VAT.

18. What is the penalty for late VAT filing?

    • Late filing attracts a penalty of Ksh. 10,000 or 5% of the tax due, whichever is higher, plus interest.

Customs and Importation

19. What taxes are applicable when importing goods?

    • Import Duty, VAT, Excise Duty, Import Declaration Fee (IDF), and Railway Development Levy (RDL) may apply depending on the goods.

20. Are there exemptions for personal effects?

    • Yes, returning residents and other eligible individuals may be exempt from certain duties on personal and household effects.

21. How are customs duties assessed?

    • Duties are assessed based on the customs value of the goods and applicable rates as per the East African Community Customs Management Act.

22. What is the process for clearing goods through customs?

    • Engage a licensed clearing agent to process import documentation through the Kenya Customs system and pay the applicable duties.

Foreign Income and Double Taxation

23. Is foreign income taxable in Kenya?

    • Kenya operates a source-based tax system; however, certain foreign incomes, such as employment income earned abroad by residents, may be taxable.

24. How can I avoid double taxation on foreign income?

    • Kenya has Double Taxation Agreements (DTAs) with several countries, allowing for tax credits or exemptions to avoid double taxation.

25. Do I need to declare foreign income on my tax return?

    • Yes, if the foreign income is taxable in Kenya, it should be declared in your annual tax return.

Tax Refunds and Waivers

26. How do I apply for a tax refund?

    • Log in to your iTax account, navigate to the ‘Refunds’ section, fill in the required details, and submit the application with supporting documents.

27. What is the timeframe for processing tax refunds?

    • Refund processing times vary; however, all claims must be submitted within the stipulated period and may be subject to audits.

28. Are there penalties for fraudulent refund claims?

    • Yes, fraudulent claims attract a penalty equal to twice the amount of the claim.

29. Is there a tax amnesty program available?

    • KRA periodically offers tax amnesty programs to encourage compliance. Details are available on the KRA website.

30. How can I apply for a waiver of penalties and interest?

    • Applications for waivers can be submitted through the iTax portal, accompanied by a justification and supporting documents.