All payments of taxes will be restricted to appointed agent banks only starting from Wednesday.
?KRA will appoint more agent banks and update the list in the KRA website, including relevant details and specific tax types to be credited to those accounts,? the taxman said in a public notice.
The current list of appointed agent banks authorised to receive tax payments on behalf of KRA are Central Bank of Kenya,? the Kenya Commercial Bank, National Bank of Kenya, Co-operative Bank of Kenya, and Equity Bank.
KRA, which usually collects through several methods, receives taxes from either its cash offices or? agent banks.
Methods used by the tax collection agency are divided into five categories including pay-as-you-earn tax (Paye), on payments to employees, and withholding tax on incomes like dividends, professional fees, and interest.
Others are Advance Tax, which applies to Kenyans who have Public Service Vehicles (like matatus) and commercial vehicles, and Installment Tax, which applies to individuals and corporate bodies. The latter applies to where the tax is not fully collected at source through Paye, and where individual?s final tax liability exceeds Sh40,000 for the year.
Another method is Turnover Tax (TOT), which is usually paid by taxpayers who are registered for TOT at the rate of three per cent on gross sales per year.
Meanwhile, KRA moved to enforce payment of rental income tax with an appeal to all tenants (individuals and institutions) to support and champion the initiative to enhance compliance among the rental income earners.
Details
The taxman said tenants are required to furnish KRA with details of their landlords, in accordance to Section 59 of the Income Tax Act 470 of the Laws of Kenya.
?The information will be used in confirmation and validation of details in our possession,? it said in a notice on Tuesday.
Among the details required from the tenants are name of landlord, land reference numbers, and location of the property, rent per month, bank account, and name of the bank and branch.
During the Budget in June, Finance Minister Njeru Githae, announced that KRA would start levying taxes on landlords.
The taxation of rental incomes is part of KRA?s effort to meet the high revenue collection targets set by the Treasury to finance the Sh1.45 trillion national Budget.
KRA estimates that landlords constitute the single largest group of business people whose income is untaxed, and plans to raise Sh90 billion in the current financial year through the proposed measures. The rental tax will be paid by all landlords earning more than Sh10,000 per month from rent, and graduated according to the Pay as You Earn scale.
By John Oyuke, The Standard
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Source: http://in2eastafrica.net/kra-only-appointed-agents-to-handle-tax/
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