KRA is Looking to Clean Your TAX Burden through its 2024-2025 Tax Amnesty Program

 The Kenya Revenue Authority (KRA) has officially rolled out a major financial lifeline for taxpayers burdened by historical tax debts. Under Section 37E of the newly enacted Tax Procedures (Amendment) Act, 2024, the government has extended a targeted tax amnesty program designed to waive interest, penalties, and fines on unpaid taxes that accrued up to December 31, 2023.

The extended amnesty, which commenced on December 27, 2024, provides a strategic six-month window for businesses and individuals to clean up their tax ledgers before the program concludes on June 30, 2025. This initiative aims to address compliance challenges by encouraging the voluntary settlement of outstanding principal taxes without the threat of punitive financial penalties.

One of the most taxpayer-friendly aspects of the program is its automatic waiver provision. If a taxpayer has already paid all principal taxes due by December 31, 2023, the KRA will automatically waive the related penalties and interest, meaning no manual application is necessary.

For those who still have outstanding principal taxes from 2023 or earlier, action is required. These taxpayers must log into their iTax portal, navigate to the Debt and Enforcement tab, and formally apply for the amnesty. The KRA system also accommodates payment plans, allowing businesses to clear their arrears in installments. However, the authority is strict on the deadline: the amnesty will only be granted if the principal tax is paid in full before June 30, 2025. Any principal amounts left unpaid after this date will immediately become subject to standard enforcement measures.

It is important to note that the amnesty is not a blanket pardon for all KRA debts. The waiver strictly covers obligations governed by the Tax Procedures Act, 2015. Customs duties administered under the East Africa Community Customs Management Act (EACCMA) are excluded. Furthermore, penalties directly related to tax avoidance (imposed under Section 85 of the Tax Procedures Act) do not qualify for the waiver.

Even for taxpayers who have fallen behind on filing their returns, taking action now pays off. Filing outstanding returns will still allow taxpayers to benefit from the amnesty for the periods up to December 2023, though any penalties and interest accruing from January 1, 2024, onwards will remain fully payable. Taxpayers actively undergoing a dispute resolution process can also qualify, provided the matter is resolved and the principal is paid within the amnesty period.