How To File Nil Returns on KRA iTax Portal

This is how you file nil returns on the iTax portal. Nil return for income tax is filed by the unemployed and those with no taxable income. It is mandatory for Kenyans within the tax bracket to file returns.

The KRA pin makes it possible to file returns. A PIN is a Personal Identification Number used while conducting business with Kenya Revenue Authority, other Government agencies and service providers.

Individual Income Tax is charged for each year of income on all the income of a person, whether resident or non-resident, which accrued in or was derived from Kenya. Income tax is a direct tax that is imposed on income derived from Business, Employment, Rent, Dividends, Interests, Pensions among others.

If you have a KRA PIN, you should file returns. If you fail to file your return by the stipulated time, the taxman will penalize you. At the moment, the penalty is Kshs 2,000.

Note that the taxman can review it at any moment. A compliance certificate is issued to those who have filed returns and paid any dues. Make sure your pin is updated on iTax.

The return process starts on the 1^st of January and ends on the 30th of June every year. You will be very lucky to find the system working normally during the last few days. Meaning you should file your returns earliest possible.

You are liable to file returns after getting a pin. The return type depends on the obligation on your tax pin. File Nil Return for Income Tax if you have no income for that specific year. Employed individuals file returns according to their P9 forms. Business people should declare their annual earnings and expenses.

How to file Nil Returns for Income Tax

1. Log into iTax portal. You will require your KRA pin and password. If you cannot remember your password, you can reset it to get a new one.
2. Once you successfully log in, the iTax portal opens.
3. Locate the Returns menu and hover the mouse pointer over it.
4. Move the pointer down and click on file nil return.
5. In the next window, select the obligation which should be Income Tax Individual for this case.
6. In the next dialogue, select the year which should be the beginning of the previous year. This should be 1st of January unless you applied for your pin in the middle of the year. In such a case, just look at your document to see the date to input. The last day of the year which is 31st December appears automatically.
7. Click on the submit button. You will get a message, ‘Dear Taxpayer filing of NIL returns is only applicable in cases where you have NO transactions to declare for the period, Are you sure you want to file Nil return?’ Click okay to proceed.
8. Your return will be submitted and a link made available for you to download the nil return acknowledgement form. You can print or save it in your email for future reference.

Errors When Filing Nil Returns for Income Tax

While filling nil return, if you get a message that you cannot file a nil return because you have employment income, note that you should use the file ITR return for employment income option. If you also have withholding certificates and advance tax, you will not be able to file zero returns.

How to View Filled Income Tax Returns

If you want to view the returns you have filed, go to the return menu, then click on view filled returns. You can click on consult without filling in the specific return you want. This option lets you view all the returns you have filled and the dates of filling.

How to Check Your Return Fines

Go to the Payments tab and click on payment registration. Some of your pin details will be displayed. Click on next. Select the tax head, tax subhead and for payment type select self-assessment tax.

Unpaid liabilities will be shown and if none you will get a message ‘no liability for the selected obligation’.

How to Generate a Payment Slip

If you followed the steps properly, you have filed Nil Return for Income Tax successfully. You can generate a payment slip if there is a liability to be paid for. Click on the radial button against the return.

Down, locate a button written ‘add’ and click on it. Down below select the mode of payment and submit. Download the generated payment slip. You can make your payment through Mpesa or go to any bank and make your payment.

Other Types of Returns

1. VAT Return – or the Value Added Tax. This is for business people who earn more than five million annually and it is filed monthly before 20th of every month.
2. PAYE – If you are an employer you are required to register for this obligation. You deduct PAYE from your employees’ salaries and wages at the prevailing rates and remit the same to KRA on or before the 9^th of the following month.
3. Turnover Tax – Turnover Tax(TOT) is a tax charged on gross sales of a business as per Sec. 12(c) of the Income Tax Act.
4. Rental Income – Monthly Rental Income Tax (MRI) is charged under Section 6A of the Income Tax Act. It is charged at a flat rate of 10% on gross rent received per month and is payable when landlords receive rent from their tenants either monthly, quarterly, semi-annually or annually.