The Kenya Revenue Authority (KRA) has issued a firm directive to businesses across the country to review their tax records and settle any outstanding dues before April 30, 2026, or risk penalties and interest.
In a statement released on Thursday, April 23, the tax authority revealed that it had flagged multiple undeclared transactions linked to the 2025 financial year.
Undeclared Transactions Flagged
According to KRA, its systems have identified discrepancies where some business transactions were not included in final tax returns.
The Authority noted that all taxpayers must ensure:
- Accurate declaration of income
- Proper recording of expenses
- Alignment between filed returns and actual transactions
Businesses that may have omitted expenses or income entries have been urged to immediately update their records to reflect the correct tax position.
Real Example: KRA Notification
In one case, a business owner received a notification from KRA highlighting discrepancies identified through the electronic system.
“We have identified business transactions recorded under your PIN through the eTIMS for the year 2025, amounting to Ksh360,000.”
The message further indicated:
“After accounting for these expenses, your taxable income is Ksh360,000, resulting in a net tax payable of Ksh18,000… Kindly note that this tax should be paid on or before April 30, 2026, to avoid penalties.”
This reflects KRA’s increasing reliance on digital tracking to enforce compliance.
Penalties for Non-Compliance
KRA warned that failure to meet the April 30 deadline will result in financial penalties.
The penalty structure includes:
- 5% of the tax due, or
- KSh 20,000, whichever is higher
Additional interest may also accrue on unpaid taxes, increasing the financial burden for non-compliant businesses.
Push for Digital Tax Compliance
The directive is part of KRA’s broader strategy to improve revenue collection through digital systems, particularly the Electronic Tax Invoice Management System (eTIMS).
The system enables the Authority to:
- Track business transactions in real time
- Reduce tax evasion
- Improve transparency in reporting
As of December 2025, KRA reported that over 500,000 businesses and taxpayers had already registered on eTIMS.
Support Channels for Taxpayers
Recognising that some businesses may face challenges, KRA has encouraged affected taxpayers to seek assistance through its official support channels.
These include:
- Customer care line: 0711 099 999
- Official social media platforms
- KRA service centres nationwide
The Authority emphasised that early engagement can help businesses avoid penalties and ensure compliance before the deadline.
Why This Matters for Businesses
The April 30 deadline is critical for businesses aiming to remain compliant and avoid unnecessary financial strain.
With KRA leveraging digital tools like eTIMS, undeclared transactions are increasingly easier to detect, leaving little room for errors or omissions.
For many businesses, this serves as a reminder to:
- Regularly reconcile financial records
- Keep accurate bookkeeping systems
- File tax returns promptly and correctly
Conclusion
KRA’s latest warning signals a tightening of tax compliance measures in Kenya, driven by digital transformation and enhanced monitoring systems.
As the April 30, 2026 deadline approaches, businesses are under pressure to review their records, correct any discrepancies, and settle outstanding taxes.
Failure to act in time could result in penalties and added costs—making early compliance not just advisable, but essential.