The Kenya Revenue Authority (KRA) has begun alerting taxpayers about unpaid Withholding Tax as part of preparations for the 2025 income tax filing season.
Withholding Tax (WHT) is a retention tax in which the payer of certain incomes deducts tax at source and remits it to KRA. Incomes subject to WHT include management or professional fees, dividends, royalties, interest, and winnings from betting and gaming.
Many Kenyans on Wednesday, February 4, received messages from KRA through email and SMS, prompting them to verify their tax obligations and file returns.
“Your 2025 income tax return is ready for filing. Our records indicate that you earned income subject to Withholding Tax (WHT). Please settle any tax due and file your returns as provided by the law. To make a payment, generate a Payment Reference Number (PRN) on iTax and complete the payment accordingly. For assistance, Call 0711 099 999.”
KRA validation of returns
This comes after KRA, in November 2025, announced that it would begin validating income and expenses declared in both individual and non-individual income tax returns against multiple data sources effective January 1, 2026.
These include TIMS/eTIMS, Withholding Income Tax gross, and import records from Customs.
The tax authority stated that all declared income and expenses must be supported by a valid electronic tax invoice transmitted with the buyer’s PIN, subject to exceptions provided under Section 23A of the Tax Procedures Act, Cap 469B, and the Tax Procedures (Electronic Tax Invoice) Regulations, 2024.
KRA further encouraged taxpayers to request TIMS/eTIMS schedules of their current annual income and expenses from designated account managers to ensure accurate reporting.
Also Read: 1.5 Million Kenyans to Be Exempted from Paying Tax- Kindiki
According to KRA, the Withholding Tax percentage varies depending on the type of income and whether the recipient is a Kenyan resident or non-resident, with the payer (withholder) responsible for deducting the tax and the recipient (withholdee) receiving the income after the deduction.
Depending on the transaction, WHT can be either a final tax or an advance payment that offsets the recipient’s annual tax liability. Refunds may be due if the tax withheld exceeds the liability, while additional payments may be required if the liability exceeds the tax withheld.
Withholding Tax must be remitted to KRA on or before the 20th of the month following the deduction. Payment can be made via iTax, KRA-appointed banks, or M-PESA using the KRA PayBill Number 572572 and quoting the Payment Registration Number (PRN) on the payment slip.
Once the tax is successfully remitted, the system automatically generates Withholding Tax Certificates, sent to the registered email addresses of both the payer and recipient. These certificates serve as proof of payment and are used to claim tax credits when filing annual returns.
How to file returns with Withholding Tax certificates
Taxpayers are required to:
- Log into iTax and download the Income Tax Return Excel from the “File Returns” tab.
- Complete the relevant tabs, including Basic Information, Profit & Loss account, Balance Sheet, Employment Income, and Tax Computation.
- Enter the total WHT from the certificate in the Tax Computation tab and include applicable reliefs or pension details.
- Validate the Excel file for errors, then upload it via iTax.
This process ensures that income subject to WHT is correctly declared and that tax credits are properly applied.
Compliance requirements
Also in November 2025, KRA introduced new requirements for obtaining Tax Compliance Certificates (TCCs) for Kenyans earning extra income from side hustles or rental properties.
Also Read: KPMG Warns Businesses as KRA Moves to Strict eTIMS-Based Tax Audits
Taxpayers must now issue electronic tax invoices through eTIMS to have their TCC approved.
“If you earn income beyond your salary, whether from a side hustle or rental property, you must issue electronic tax invoices through eTIMS for your TCC to be approved. By staying compliant, you strengthen your eligibility for tenders, contracts, and bigger business opportunities,” KRA said.
The eTIMS platform can be accessed on computers, laptops, tablets, or smartphones, and is mandatory for all businesses, whether registered for VAT or not.
Larger businesses may integrate their systems directly with eTIMS through the Virtual Sales Control Unit (VSCU) or the Online Sales Control Unit (OSCU).
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