FAQs

16. Are there penalties for non-compliance?

Section 18E of the ITA provides that a person who fails to comply with provisions of section 18C and 18D commits an offence and shall be subject to the penalties prescribed under the Tax Procedures Act, 469B (TPA).

17. What is the CbC MCAA?

The CbC MCAA is a multilateral framework agreement that provides a standardized and efficient mechanism to facilitate the automatic exchange of CbC Reports.

18. Are CbC exchange mechanisms activated in Kenya?

  • The exchange mechanisms are only activated for jurisdictions that Kenya has both the Convention on Mutual Administrative Assistance in Tax Matters (the MAAC) in force and the Multilateral Competent Authority Agreement for exchange of CbC reports (CbC MCAA) in effect at the time of filing of the CbC reports for the financial year in question.

 

  • Kenya has ratified the MAAC and has a competent authority agreement in effect i.e. the CbC MCAA.

19. Which tax jurisdictions does the Kenya have competent authority arrangements (CAAs) with for the automatic exchange of CbC reports?

The list of jurisdictions with an effective exchange relationship with Kenya is available on the OECD website using the link -

https://www.oecd.org/content/dam/oecd/en/topics/policy-issues/tax-transparency-and-international-co-operation/cbc-mcaa-signatories.pdf

 

20. What measures are in place to maintain the confidentiality of this information once it is provided and shared among jurisdictions?

  • Section 18D (11) of the ITA provides that the commissioner shall maintain the confidentiality of the information contained in a return submitted in accordance with section 6(1) and section 6A (2) of the TPA.

 

  • Kenya has also ratified the MAAC and the CbC MCAA. These instruments provide legal protections for the confidentiality of information exchanged. CbC Reports exchanged with Kenya are subject to the applicable confidentiality and data protection provisions governing the exchange of information under these instruments.

21. How will the KRA use CbC data?

KRA shall use the CbC Report only for purposes of assessing high-level transfer pricing risks and other BEPs related risks in Kenya, including assessing the risk of non-compliance by members of the MNE Group with applicable transfer pricing rules, and where appropriate for economic and statistical analysis.

22. Are there any specific exemptions from CbC reporting requirements other than 95 billion Kenyan shillings threshold which would exclude an entity from CbC reporting?

There are no other exemptions.

23. Where should CbC reporting related questions be directed?

CbC reporting queries can be directed to:

  1. Email: cbcr@kra.go.ke or  kenyacompetentauthority@kra.go.ke
  2. Contacts: 0709-017945/85/33/1890 or Call center (0711) 099 999