The Finance Act 2016 introduced an amnesty on all taxes, penalties and interest for the years of income ending on or before 31 December 2016 for taxpayers with foreign earned taxable income. Additionally, this new provision restrains the Commissioner General of the Kenya Revenue Authority (read Kenya Revenue Authority) from following-up or enquiring on the sources of such income.

The global tax landscape is a fluid entity - in an ever changing and increasingly complex environment which has seen the arrival of significant tax-related reforms.

The Financier Worldwide features opinions of leading professionals around the world on the latest trends in global tax. Our Tax Partner Michael Mburugu discusses the trends in the Kenya tax landscape (see page 68).

Introduction

The Finance Bill, 2014 (FB 2014) proposes several changes to the Income Tax Act (ITA).

Introduction

The Finance Bill, 2014 (FB 2014) proposes several changes to the Income Tax Act (ITA).

Introduction

The Value Added Tax Act, 2013 has been amended by the Value Added Tax (Amendment) Act, 2014 which received assent on 8 May 2014. The Amendment Act has primarily focused on expanding the list of exempt supplies. These changes will be effective from 29 May 2014.

Introduction

The Kenya Revenue Authority (‘’KRA’’) issued a public notice on 24 February 2014 announcing the roll out of iTax, its new online taxpayer portal. This signals the end to manual filing of returns and ushers a new period of efficient and effective delivery of online taxpayers’ services.

Introduction

The National Social Security Fund (NSSF) has undergone an overhaul following the enactment and coming into force of the new NSSF Act, 2013. The new Act was signed by the President on 24 December, 2013 and will become effective on 31st May, 2014.

Introduction

The Kenya Revenue Authority (KRA) has in the previous five years implemented an Integrated Tax Management System (ITMS) aimed at merging all its parallel department/station processing systems. This has now been improved further to iTax, a web-enabled and secure application system that provides a fully integrated and automated solution for administration of domestic taxes.

iTax facilitates internet-based registration, filing, paying & status inquiries with real-time monitoring of accounts.

The KRA issued Legal Notice No. 52 of 14 June 2012 on payment of Advance Tax on commercial vehicles at the rates specified in the Legal Notice

The effect of the Legal Notice is that Advance Tax shall be payable by the 20th day of the first month of the year of income.

In  March  2012,  the  Director  of  the  Large  Taxpayers Department of the Federal Inland Revenue Service (“FIRS”) of Nigeria made a presentation of the proposed transfer pricing  regulations  (“proposed  regulations”)  due  to  be effected sometime in 2012.

In January 2012, the Uganda Revenue Authority (URA) issued draft transfer pricing documentation requirements and solicited feedback on the same from Ugandan tax advisors.  This culminated in URA publicly issuing Practice Notes on 14   May 2012 detailing the transfer pricing documentation to be kept by taxpayers.

The Harmonized Commodity Description and Coding System (HS) is a multipurpose international product nomenclature developed and maintained by the World Customs Organization (WCO). It comprises about 5,000 commodity groups and encompasses more than 200,000 commodities.

The HS is used by more than 200 countries and economies as a basis for their Customs tariffs and for the collection of international trade statistics. Every commodity that crosses international borders must be classified with an HS code.

After much delay, the Kenyan Parliament finally passed the Finance Act, 2012 on May, 2 2012. This long-overdue legislation passes into law several changes proposed in the Finance Bill, 2011. However, some amendments have been incorporated to the Finance Act.

On 12^th September 2012, Ghanaian lawmakers adopted transfer pricing rules following the arm's-length principle and requiring the use of the “most appropriate” method to price related-party transactions.

Legislative Instrument No. 2188, effective from July 27,2012, sets forth five approved transfer pricing methods, with “other” methods permitted when the tax authority agrees that the arm's-length price cannot be determined using one of the approved methods.

Introduction

The Minister of Finance in his 2011 Budget Statement promised the proposed new VAT law will be published in time for public scrutiny and discussion in August 2011. The VAT Bill 2011 was posted to the Ministry of Finance website on 26 July and will, if enacted, bring far-reaching changes to the Kenyan VAT regime. This issue of Tax Alert brings you highlights of the major changes proposed to our VAT regime. No action should be taken based on these highlights as the bill is still not yet law.

Introduction

The Minister for Finance, Planning and Development has finally published the Income Tax (Transfer Pricing) Regulations, 2011. These regulations are based on provisions of Section 90 and Section 164 of the Ugandan Income Tax Act and take effect from 1 July 2011.

The Ugandan Revenue Authority is joining the global trend towards laying emphasis on non-traditional revenue sources and moving towards Transfer Pricing and related party transactions. In this regard, these regulations are meant to ensure that transactions between Ugandan taxpayers and related non-resident entities are at arm’s length.

The Commissioner has vide a Public Notice published in the Dailies of 29 July 2011, exercised powers granted under Section 16(5) of the ITA to prescribe the manner and form for payment of taxes on deemed interest. He has prescribed a deemed interest rate of 6% for the months of July, August and September 2011.

Additionally, the Commissioner has prescribed the tax period for withholding tax purpose to be a calendar month, hence any withholding tax due on the deemed interest is payable to the KRA by the 20th day month of the month following that for which the deemed interest is computed.

The Commissioner has vide a Public Notice published in the Dailies of 29 July 2011, exercised powers granted under Section 16(5) of the ITA to prescribe the manner and form for payment of taxes on deemed interest. He has prescribed a deemed interest rate of 6% for the months of July, August and September 2011.

Additionally, the Commissioner has prescribed the tax period for withholding tax purpose to be a calendar month, hence any withholding tax due on the deemed interest is payable to the KRA by the 20th day month of the month following that for which the deemed interest is computed.

Introduction

Kenya Revenue Authority (KRA) issued a public notice 12th September 2011 effecting changes in the VAT filing process. The Public Notice is a follow-up to public Notice No. 37 of 2003 which required that VAT credits filed as Refund Claims be removed from the VAT 3 Return. It also abolished Withholding VAT collection with effect from 1 July 2011. The public notice has introduced two major changes.