Learn About Compliance

What Penalties are Charged on Tax Offences?

Tax offences can attract punitive penalties and interest.

These include:


Offence - Failure to deduct PAYE, account for it or to submit a certificate upon request.

Penalty - Whichever is greater of, 25% of the amount of the tax involved or Ksh. 10,000.


Offence - Failure to deduct or pay Withholding Tax.

Penalty - 10% of the amount of the tax involved, up to a maximum of Kshs. 1 million. 


Offence - Failure to pay Stamp Duty.

Penalty - Additional 5% of the payable duty for every quarter, from the date of the Instrument.


Offence - failure to pay Excise Duty or VAT.

Penalty - whichever is greater of, 5% of the amount of the tax due or Ksh. 10,000. 


Offence - Failure to pay tax on due date.

Penalty - Additional 20% of tax involved is charged.


Offence - Failure to file annual returns by the due date. 

Penalty - Additional tax equal to 5% of the normal tax, or Ksh. 10,000. 


Offence -  KRA PIN-related offense.

Penalty -  Ksh. 2,000 per offence.