The Kenya Revenue Authority (KRA) has restored the ‘Nil return’ filing option after upgrading its systems with stricter validation checks ahead of the 2025 income tax filing season, which closes in June. The move follows a temporary suspension that had unsettled individual taxpayers and small firms.
In a notice issued by its Business Strategy, Technology and Enterprise Modernisation Department, KRA said the nil return option will apply to income tax returns for the January to December 2025 period that are filed after March 31, when enhanced checks embedded in the iTax platform take effect.
The authority clarified that the reinstatement does not alter filing requirements for 2024 returns or earlier years, nor does it affect monthly obligations such as PAYE, excise duty, monthly rental income tax and turnover tax, which will continue as usual.
The earlier suspension of nil returns in January had triggered confusion, particularly among taxpayers declaring no income despite having transactions visible to KRA through third-party data sources.
According to KRA officials, the changes form part of a wider clampdown on misuse of nil filings, especially by taxpayers whose income had already been subjected to withholding tax but who nonetheless declared zero earnings. George Obell said in January that the authority had identified widespread abuse, noting that 392,162 taxpayers who had tax deducted at source in 2025 still filed nil returns for the 2024 income year.
He explained that many taxpayers mistakenly treat withholding tax, such as the 5 percent deducted on management or professional fees and 3 percent on contractual fees, as a final tax liability rather than an advance payment.
Also Read: Carbon Credits Row Sparks Koko Networks Collapse in Kenya
KRA is now increasingly prepopulating tax returns using third-party data, making it more difficult to omit income. Obell said that once income is reflected in prefilled returns, taxpayers will not be able to ignore it, as the authority already has visibility of the withholding amounts and corresponding total earnings. Those who fail to regularise discrepancies risk further scrutiny, potentially extending to previous years.
Taxpayers have also been urged to confirm the accuracy of their Personal Identification Numbers on iTax as the system draws on consolidated data streams.
The enhanced oversight is supported by the rollout of the electronic Tax Invoice Management System, which captures transactional data across the economy and links suppliers, customers and transaction values. The reinstatement coincides with KRA’s Income and Expenditure Verification programme, launched on January 1, 2026, which aggregates data from eTIMS invoices, withholding certificates and import records to cross-check declared figures.
Patience Njau said the focus this year is to convert nil filers, non-filers and zero payers into fully compliant taxpayers.
