Friday, April 17,
2026 - The Kenya Revenue Authority (KRA) has announced sweeping changes in
tax compliance procedures, scrapping the long-standing Nil Returns system and
introducing a new “PIN With No Obligation” (PWO) category.
The directive, unveiled this week, is aimed at individuals
who hold Personal Identification Numbers (PINs) but have no taxable income or
are not engaged in taxable activities.
Previously, such taxpayers were required to file Nil Returns
annually to remain compliant, a process many considered unnecessary and
burdensome.
Under the new framework, taxpayers registered under the PWO
category will no longer be required to file annual returns.
“iTax has been enhanced to enable Individual Taxpayers (both
Residents and Non-Kenyan Non-Residents) to generate a PIN with No Obligation,”
KRA stated.
The Authority explained that the initiative is designed to
enhance the integrity of the taxpayer register, particularly for groups such as
students who may need a PIN for services like accessing higher education loans
or conducting non-taxable transactions.
However, KRA emphasized that individuals under the PWO
category who later begin earning income or engaging in taxable activities must
update their PIN details and start filing annual returns.
Failure to comply could attract penalties (Ksh20,000 or 5
percent of tax due for companies, and Ksh2,000 for individuals, whichever is
higher).
KRA further noted that development is ongoing to allow
taxpayers with existing PINs carrying obligations to transition to the new
category.
Applications for PWO can be made through the iTax portal,
with an identity card as the only requirement.
The announcement comes amid heightened enforcement by KRA,
which has urged all income earners to file their annual tax returns by June 30,
2026, to avoid penalties.
The Kenyan DAILY POST
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