KRA Temporarily Suspends Nil Tax Filings to Bring More Kenyans into the Tax Net

Nairobi — The Kenya Revenue Authority (KRA) has temporarily suspended the filing of nil tax returns in a major compliance drive aimed at converting millions of nil filers and non-filers into active taxpayers.

The suspension, which takes immediate effect, applies to the filing of nil returns for the 2025 tax year on KRA’s iTax platform. Nil returns are typically filed by individuals who report no taxable income within a given year.

KRA says the move will remain in force as the authority undertakes a comprehensive data validation exercise across its systems.

According to KRA, the decision is intended to curb abuse of the nil filing option by individuals and businesses that earn income but still declare zero tax liability.

The authority plans to cross-check taxpayer records against multiple data sources, including withholding tax records, electronic invoicing data under eTIMS, customs information, and other third-party financial data.

KRA officials say the exercise will help identify taxpayers who should be filing active returns and paying tax, rather than consistently declaring nil income. Once the review is complete, the authority will reinstate nil return filings, with validated data expected to support more accurate tax declarations.

Expanding the Tax Base

The suspension comes against the backdrop of a wide gap between registered taxpayers and those who actively pay tax. While millions of Kenyans hold Personal Identification Numbers (PINs), only a fraction consistently file and pay taxes, leaving a small segment of the population carrying the bulk of the tax burden.

KRA argues that broadening the tax base is critical for improving fairness in the tax system and boosting domestic revenue collection at a time when the government is under pressure to finance public services and development projects.

“This is about ensuring equity and integrity in the tax system,” the authority said, noting that data-driven compliance measures are increasingly central to modern tax administration.Digital Compliance Push As part of the wider compliance strategy, KRA has continued to roll out digital tools aimed at making it easier for taxpayers to regularise their status.

These include automated payment plans that allow taxpayers to clear outstanding tax liabilities in instalments, as well as digital support services to guide users through filing and payment processes.

Taxpayers who genuinely have no income during the affected period have been advised to keep proper records, which may be required once nil filings are reinstated.

Concerns Over Filing Timelines

The move has drawn mixed reactions, with some taxpayers expressing concern that the suspension could compress the timeline for filing returns ahead of the statutory June 30 deadline. KRA, however, maintains that the measure is temporary and not intended to penalise compliant taxpayers.The authority says further guidance will be issued once the data verification exercise is concluded, including timelines for the restoration of nil return filings.

Broader Revenue Reforms

The suspension of nil filings is part of a broader shift by KRA toward data-led enforcement and digitisation, aimed at sealing revenue leakages and improving voluntary compliance.

As the authority intensifies scrutiny, taxpayers are being urged to review their income sources, update their records, and ensure their tax affairs are in order.

KRA insists that the long-term goal is not punishment, but the creation of a fairer system in which all eligible taxpayers contribute their share to national development.