Filing returns refers to the process of submitting your tax-related information to the Kenya Revenue Authority (KRA). Individuals and businesses are required to file returns on an annual basis to report their income, expenses, and other relevant financial information for the purpose of calculating their tax liabilities.
For individuals, the main form used for filing returns is the Individual Income Tax Return, commonly known as the “ITR.” This form captures details of an individual’s income from various sources, deductions, and tax reliefs claimed, among other relevant information.
Businesses, on the other hand, are required to file returns using different forms depending on their legal structure. For example, companies file their returns using the Company Income Tax Return (ITR-6), while partnerships file using the Partnership Income Tax Return (ITR-3). The specific form to be used depends on the legal structure and nature of the business.
Filing returns is an important obligation as it ensures that individuals and businesses comply with the tax laws of Kenya and contribute their fair share of taxes. Failure to file returns or providing false information can result in penalties and legal consequences. Therefore, it is crucial to accurately report your financial information and file returns within the prescribed timelines set by the KRA.