The Kenya Revenue Authority (KRA) has introduced temporary relief measures for taxpayers filing income tax returns for the 2025 year of income as the June 30 filing deadline draws closer.
In a notice issued on Monday, June 8, the tax authority announced that taxpayers will be allowed to claim legitimate business expenses even where they are not backed by eTIMS or TIMS invoices.
According to KRA, the move is intended to ease the filing process for the current tax period. Taxpayers will be permitted to upload such expenses when submitting returns, although the claims will be reviewed and verified after filing.
The Commissioner for Micro and Small Taxpayers clarified that the concession applies exclusively to 2025 tax returns and will not be extended beyond the current filing cycle.
KRA warned that beginning with the 2026 year of income, all declared earnings and expenses must be supported by valid electronic tax invoices generated and transmitted through the eTIMS/TIMS system.
The authority also cautioned taxpayers against missing the June 30, 2026 deadline, noting that those who fail to submit their returns on time will face default assessments under the Tax Procedures Act.
Under the law, KRA is empowered to estimate and assess tax liabilities for individuals who do not file returns. Such assessments often attract higher tax obligations alongside penalties and interest charges.
This means the authority may rely on available taxpayer data to generate assessments for individuals who fail to meet the filing deadline.
Meanwhile, KRA continues to grapple with revenue collection challenges after falling short of its targets despite implementing various tax relief measures. Treasury data indicates the revenue shortfall widened significantly by March 2026, with ordinary revenue collections reaching KSh 1.82 trillion against a target of KSh 1.98 trillion.
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As part of efforts to enhance tax compliance and seal revenue leakages, KRA is also proposing new regulations that would require landlords earning residential rental income to register their properties through the Electronic Rental Income Tax System (eRITS).
If approved, the regulations will apply to landlords earning between KSh 288,000 and KSh 15 million annually from residential properties, making registration on the digital platform mandatory.
