TAX AUTOMATION SYSTEM

KRA integrates NSSF and NHIF to iTAX

The integrated system will be rolled out to the first set of 90,500 employers and ultimately to all employers by December.

In Summary

•The authority is also exploiting information held by other government bodies including Kenya Power, National Transport And Safety Authority (NTSA), commercial banks and property registries in the harmonisation of filled returns.

•KRA in facilitation of this is pursuing an application programming interface (APIs) with external entities to allow flow information and data.

A file photo of taxpayers lining up along Harambee Avenue in Nairobi where Kenya Revenue Authority is located.
A file photo of taxpayers lining up along Harambee Avenue in Nairobi where Kenya Revenue Authority is located.

The Kenya Revenue Authority has integrated tax and statutory deductions by employers which will now be administered under one platform.

The electronic payment system brings together KRA's iTax, National Social Security Funds online systems, and National Hospital Insurance Fund payments.

The unification of NSSF online payment system (SSPAS) and iTAX was completed in February after  piloting since 2017.

According to KRA, the system is expected to reduce the cost of compliance and curb tax revenue leakage.

KRA commissioner for domestic taxes Elizabeth Meyo said the unified payroll return will be rolled out to the first set of 90,500 employers and ultimately to all employers by December.

“It will bring all payroll taxes together under one platform. It will capture all returns for NHIF, KRA and NSSF to reduce time and cost of compliance,” Meyo said.

 

The integration is one of the tax authority's national integration and monitoring strategies through use of technology to increase the tax base and curb evasion.

The authority is also exploiting information held by other government bodies including Kenya Power, National Transport And Safety Authority (NTSA), commercial banks and property registries in the harmonisation of filled returns.

“We are employing the data-driven compliance approach. The authority has data but has to employ the data held by third parties,” she added.

 
 
 
 

“Kenya Power, for instance, gives details of landlords with properties and receiving income but don't declare. At times when we send notices, taxpayers complain that what we send is higher than what they anticipate."

KRA commissioner for strategy, innovation and risk management Mohammed Omar said the integration is both within the government and outside and data received will be purely used for tax analysis.

The tax authority aims at raising the taxpayers base from 3.94 million to 7 million, an additional 3.06 million taxpayers.

It also targets an additional 10,500 corporate bodies based economic growth and on the 78,000 corporates who were compliant in 2017/18 financial year.

This also including 40,000 individuals trading online, recruitment of 66,000 landlords and 430,000 registered companies that are not seen to be active in the system.