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KRA finally granted complete access to bank accounts.
maka
#21 Posted : Monday, November 13, 2017 6:54:49 PM
Rank: Elder


Joined: 4/22/2010
Posts: 11,522
Location: Nairobi
winmak wrote:
Swenani wrote:
obiero wrote:
winmak wrote:
maka wrote:
Angelica _ann wrote:
NSE .....CDSC smile



You still have to explain where you got the cash for the trades...If it doesnt add up they will just take your stocks or bonds....Bummer


Money going to CDS mostly is from a bank account where you already declared if above a million. What I find annoying is u accumulate over years then suddenly taxman wants to know after you have 20 m diligently saved and reinvested

Plus some stocks accumulate value over time. So 1m today could turn into 2m next year


Watu walipe tax, if you have been saving and paying taxes, you can easily prove it.

If your shares gain value, pay capital taxes upon disposal.




Hiyo ilitolewa


Exactly...
possunt quia posse videntur
Hobitke
#22 Posted : Monday, November 13, 2017 7:09:34 PM
Rank: New-farer


Joined: 5/22/2016
Posts: 69
Location: Nairobi
If only all the taxes were put to good use, most people would not refuse, as a business you pay tax, you see no benefits, as an individual you pay tax, you see no services, you even to pay health insurance . What are our taxes used for? paying Mps? Buying guzzlers as hospitals and roads get neglected? As fat cats keep getting fatter as the common man is over taxed as KRA keeps using trial and error methods to try and plug the deficits?
Gathige
#23 Posted : Monday, November 13, 2017 7:54:33 PM
Rank: Elder


Joined: 3/29/2011
Posts: 2,242
The best point to capture tax is at source of income. This is also the most efficient and cost effective point devoid of kick backs. Tax collection through fishing when you catch a suspect and they try to deduce the tax due is counterproductive in the long run.
"Things that matter most must never be at the mercy of things that matter least." Goethe
Chaka
#24 Posted : Monday, November 13, 2017 9:08:00 PM
Rank: Elder


Joined: 2/16/2007
Posts: 2,114
Would wish to know how the landlord/tenant reporting thing went?If I was a landlord and you report me,utalipa..
Gathige wrote:
The best point to capture tax is at source of income. This is also the most efficient and cost effective point devoid of kick backs. Tax collection through fishing when you catch a suspect and they try to deduce the tax due is counterproductive in the long run.

murchr
#25 Posted : Monday, November 13, 2017 9:33:36 PM
Rank: Elder


Joined: 2/26/2012
Posts: 15,979
the_cabal wrote:
Quote:
The taxman has set up a database known as Data Warehouse and Business Intelligence, which offers a single view of a taxpayer's profile, linking them with third-party systems such as banks and utility firms for easier determination of compliance.


Should i embrace mattress banking? Think



Who comes up with such names Shame on you
"There are only two emotions in the market, hope & fear. The problem is you hope when you should fear & fear when you should hope: - Jesse Livermore
.
Angelica _ann
#26 Posted : Tuesday, November 14, 2017 7:50:20 AM
Rank: Elder


Joined: 12/7/2012
Posts: 11,901
This is a noble idea, let is see how it works out in implementation phase.
In the business world, everyone is paid in two coins - cash and experience. Take the experience first; the cash will come later - H Geneen
Swenani
#27 Posted : Tuesday, November 14, 2017 9:02:12 AM
Rank: User


Joined: 8/15/2013
Posts: 13,236
Location: Vacuum
Gathige wrote:
The best point to capture tax is at source of income. This is also the most efficient and cost effective point devoid of kick backs. Tax collection through fishing when you catch a suspect and they try to deduce the tax due is counterproductive in the long run.


What about those with foreign sources of income? How will KRA capture that?
If Obiero did it, Who Am I?
quicksand
#28 Posted : Tuesday, November 14, 2017 9:04:19 AM
Rank: Veteran


Joined: 7/5/2010
Posts: 2,061
Location: Nairobi
Chaka wrote:
Would wish to know how the landlord/tenant reporting thing went?If I was a landlord and you report me,utalipa..
Gathige wrote:
The best point to capture tax is at source of income. This is also the most efficient and cost effective point devoid of kick backs. Tax collection through fishing when you catch a suspect and they try to deduce the tax due is counterproductive in the long run.



You would never know who reported you. Tax obligations never lapse, and that is what should cause people worry. The records exist, and new data keeps coming in with all these legislative victories they are scoring. Never assume cause KRA has not yet claimed tax since some regulation came into effect that you are off the hook ...they are just incompetent and disorganized.
A day will come when advances in technology will allow them to scrutinize all these mountains of data and reach whatever deep, dark depths you are hiding and take monies owed from you ....
the_cabal
#29 Posted : Tuesday, November 14, 2017 4:17:53 PM
Rank: New-farer


Joined: 11/20/2015
Posts: 16
Location: Iraq
Swenani wrote:
Gathige wrote:
The best point to capture tax is at source of income. This is also the most efficient and cost effective point devoid of kick backs. Tax collection through fishing when you catch a suspect and they try to deduce the tax due is counterproductive in the long run.


What about those with foreign sources of income? How will KRA capture that?



For that, KRA did issue tax amnesty for any income earned in foreign countries.

"The Kenya Revenue Authority (KRA) has now issued guidelines on the eligibility and application process for the amnesty. According to the guidelines, the application for amnesty must be submitted online through the iTax platform using form A/37B on or before 31 December 2017. The application should give a complete and accurate disclosure with respect to the assets and liabilities that resulted from the foreign income." Source [PDF] - Ernst & Young

KRA Public Notice [PDF] - Tax Amnesty Guidelines on Foreign Income
Mganga haagizi Mchicha.
the_cabal
#30 Posted : Tuesday, November 14, 2017 4:45:13 PM
Rank: New-farer


Joined: 11/20/2015
Posts: 16
Location: Iraq
the_cabal wrote:
Swenani wrote:
Gathige wrote:
The best point to capture tax is at source of income. This is also the most efficient and cost effective point devoid of kick backs. Tax collection through fishing when you catch a suspect and they try to deduce the tax due is counterproductive in the long run.


What about those with foreign sources of income? How will KRA capture that?



For that, KRA did issue tax amnesty for any income earned in foreign countries.

"The Kenya Revenue Authority (KRA) has now issued guidelines on the eligibility and application process for the amnesty. According to the guidelines, the application for amnesty must be submitted online through the iTax platform using form A/37B on or before 31 December 2017. The application should give a complete and accurate disclosure with respect to the assets and liabilities that resulted from the foreign income." Source [PDF] - Ernst & Young

KRA Public Notice [PDF] - Tax Amnesty Guidelines on Foreign Income



UPDATE:

37B. Commissioner to refrain from assessing tax for income earned outside Kenya

Notwithstanding any other provision of this Act, the Commissioner shall refrain from assessing or recovering taxes, penalties or interest in respect of any year of income ending on or before the 31st December, 2016, and from following up on the sources of income under the amnesty where —

(a) that income has been declared for the year 2016 by a person earning
taxable income outside Kenya; and
(b) the returns and accounts for the year 2016 are submitted on or before
the 31st December, 2017:
Provided that this section shall not apply in respect of any tax where the person who should have paid the tax—

(i) has been assessed in respect of the tax or any matter relating
to the tax; or
(ii) is under audit or investigation in respect of the undisclosed
income or any matter relating to the undisclosed income.
"

The Finance Act 2016 introduced Section 37B into the Tax Procedures Act, 2015. - The Revised Edition 2016 [PDF]

Mganga haagizi Mchicha.
Swenani
#31 Posted : Tuesday, November 14, 2017 5:30:00 PM
Rank: User


Joined: 8/15/2013
Posts: 13,236
Location: Vacuum
the_cabal wrote:
Swenani wrote:
Gathige wrote:
The best point to capture tax is at source of income. This is also the most efficient and cost effective point devoid of kick backs. Tax collection through fishing when you catch a suspect and they try to deduce the tax due is counterproductive in the long run.


What about those with foreign sources of income? How will KRA capture that?



For that, KRA did issue tax amnesty for any income earned in foreign countries.

"The Kenya Revenue Authority (KRA) has now issued guidelines on the eligibility and application process for the amnesty. According to the guidelines, the application for amnesty must be submitted online through the iTax platform using form A/37B on or before 31 December 2017. The application should give a complete and accurate disclosure with respect to the assets and liabilities that resulted from the foreign income." Source [PDF] - Ernst & Young

KRA Public Notice [PDF] - Tax Amnesty Guidelines on Foreign Income


Read the definition of assets as per the guidelines and you will note that Kenyans who have assets in Kenya procured with foreign sources were not included in the Amnesty



If Obiero did it, Who Am I?
josimar
#32 Posted : Tuesday, November 14, 2017 5:34:40 PM
Rank: Member


Joined: 7/6/2010
Posts: 242

People will keep their cash at home for sure . I see an increase in sales of home safes.
the_cabal
#33 Posted : Tuesday, November 14, 2017 6:05:24 PM
Rank: New-farer


Joined: 11/20/2015
Posts: 16
Location: Iraq
Swenani wrote:
the_cabal wrote:
Swenani wrote:
Gathige wrote:
The best point to capture tax is at source of income. This is also the most efficient and cost effective point devoid of kick backs. Tax collection through fishing when you catch a suspect and they try to deduce the tax due is counterproductive in the long run.


What about those with foreign sources of income? How will KRA capture that?



For that, KRA did issue tax amnesty for any income earned in foreign countries.

"The Kenya Revenue Authority (KRA) has now issued guidelines on the eligibility and application process for the amnesty. According to the guidelines, the application for amnesty must be submitted online through the iTax platform using form A/37B on or before 31 December 2017. The application should give a complete and accurate disclosure with respect to the assets and liabilities that resulted from the foreign income." Source [PDF] - Ernst & Young

KRA Public Notice [PDF] - Tax Amnesty Guidelines on Foreign Income


Read the definition of assets as per the guidelines and you will note that Kenyans who have assets in Kenya procured with foreign sources were not included in the Amnesty






May be should call for an ammendment of the law.
Mganga haagizi Mchicha.
the_cabal
#34 Posted : Tuesday, November 14, 2017 6:10:16 PM
Rank: New-farer


Joined: 11/20/2015
Posts: 16
Location: Iraq
josimar wrote:

People will keep their cash at home for sure . I see an increase in sales of home safes.



Current political quagmire blinding the citizens from seeing what the taxman is up to, am sure this will be petitioned in a court of law when dust settles down.
Mganga haagizi Mchicha.
Mike Ock
#35 Posted : Tuesday, November 14, 2017 6:31:49 PM
Rank: Member


Joined: 1/22/2015
Posts: 682
Gathige wrote:
The best point to capture tax is at source of income. This is also the most efficient and cost effective point devoid of kick backs. Tax collection through fishing when you catch a suspect and they try to deduce the tax due is counterproductive in the long run.


That is ideal, but impractical. You want people to somehow send KRA money with every transaction they do? Further to that people will still runaway from the tax responsibility that way.

The most practical thing for making tax easy is for KRA to use their newfound powers to calculate for people their due taxes, then send them the bill at the end of every month/year. Pay that bill and you're home and dry. No guessing about whether you're fully compliant, and no bullying by KRA officials claiming you didn't pay this or that. This is done in many developed countries.
madhaquer
#36 Posted : Tuesday, June 19, 2018 9:39:46 AM
Rank: Member


Joined: 11/10/2010
Posts: 281
Location: Nairobi
I am looking for information regarding tax regulations for those in the diaspora.
What exactly is the law for filing and paying returns for Kenyans out of the country ?
sparkly
#37 Posted : Tuesday, June 19, 2018 2:26:15 PM
Rank: Elder


Joined: 9/23/2009
Posts: 8,083
Location: Enk are Nyirobi
Mike Ock wrote:
Gathige wrote:
The best point to capture tax is at source of income. This is also the most efficient and cost effective point devoid of kick backs. Tax collection through fishing when you catch a suspect and they try to deduce the tax due is counterproductive in the long run.


That is ideal, but impractical. You want people to somehow send KRA money with every transaction they do? Further to that people will still runaway from the tax responsibility that way.

The most practical thing for making tax easy is for KRA to use their newfound powers to calculate for people their due taxes, then send them the bill at the end of every month/year. Pay that bill and you're home and dry. No guessing about whether you're fully compliant, and no bullying by KRA officials claiming you didn't pay this or that. This is done in many developed countries.


This is what happens with salaries, interest, dividends, rent, Withholding VAT, Pensions, consultancy.
Life is short. Live passionately.
MugundaMan
#38 Posted : Tuesday, June 19, 2018 4:39:28 PM
Rank: Elder


Joined: 1/8/2018
Posts: 2,211
Location: DC (Dustbowl County)
Gathige wrote:
The best point to capture tax is at source of income. This is also the most efficient and cost effective point devoid of kick backs. Tax collection through fishing when you catch a suspect and they try to deduce the tax due is counterproductive in the long run.


Seconded.
Also I like KRA's method of collecting a flat rate of 10% on rental income up to a certain threshold. Has really streamlined things. If only they could get rid of the cumbersome ITAX app and create one that is straightforward and time saving. Filing rental income returns on ITAX is like trying to put together a jigsaw puzzle.

Some free advice to Unyee if he wants to curb corruption in Kenya and make KRA revenues soar big time overnight

1. Expand the need for KRA PIN to almost everything in order to widen the tax net. Want your child to join std 1 - toa KRA pin, want to access any single government service; toa PIN, Want to get married, toa PIN. Want your water or stima connected, toa PIN. You get the point.

2. Huge sums of bank balances in any account (say cash balances of over kshs 100 million) should be automatically flagged and deposits into said account subject to scrutiny/reporting by the bank on a monthly basis.

3. Since 90% of the Kenyan economy is informal. Tax at a flat rate per individual/business instead of applying taxes progressively as is done in the formal sector. I hear Nairobi County is switching to this. If this is so, this is a masterstroke. Instead of hoping say a kiosk owner will report all their income (they wont) better to charge them a flat rate fee based on anticipated revenues for the year. E.g 25,000 kshs flat tax for a kiosk owner, but payable in installments. If they claim they did not generate enough revenue to meet the minimum bogey, let them prove it with their receipts, bank deposits, MPESA records etc in order to get the correct assessment.

4. Impose a 50% "unexplained income" tax on bank accounts. If someone makes a 50m cash deposit using gunias in a single day and has no convincing paperwork to prove where they got it. Tax it at 50% while investigations go on, or until the person proves the source of income.

5.Require a KRA PIN and KRA tax compliance certificate for every Kenyan flying into the country from abroad, as part of the entry requirements. This will net all diaspora tax evaders overnight (there are millions of them).

6. Lifestyle audit an absolute MUST for every public servant, in which assets and incomes are explained and audited in depth. 100% tax imposed on any unexplained assets or resources.

7. Conviction by a court of law for grand corruption above a certain threshold (say 1 million kshs) should automatically lead to a 50% gross tax on any and all assets the invididual owns, whether or not they were part of the proceeds of corruption.

8. KRA should pay people 10% of taxes netted on giving information that leads to the netting of a tax evader. Let's say your neighbour has an illegal duka next to you and you report them to KRA, if KRA captures 50,000 kshs worth of lost tax revenue, you will be paid kshs 5000. Make being an informant a full time job for the millions of unemployed youth around the country.

9. Parade grand corruption convicts in handcuffs and in their underwear up and down Kenyatta Avenue once a week
and broadcast live on all TV stations, before promptly returning them to Kamiti, then repeating the same the next week until the sentence is complete

Hayo tu

capitalism
#39 Posted : Thursday, June 21, 2018 12:41:46 PM
Rank: New-farer


Joined: 4/12/2011
Posts: 26
I did see this amnesty program, actually i came across it since i ply my trade in the Murky world of offshore finance and some clients were in haste to move the funds in order to comply.In my humble opinion, we all know that Kenya operates through a source-based tax regime. Therefore, not all foreign earned income is taxable in Kenya. Furthermore, with Kenya not having foreign exchange controls in place, this forced repatriation of funds is futile and it severs no purpose. Reason being, an investor could easily repatriate cash today as required to comply with the amnesty requirements and tomorrow, re-invest the same cash abroad. Then What??
Mike Ock
#40 Posted : Thursday, June 21, 2018 2:57:01 PM
Rank: Member


Joined: 1/22/2015
Posts: 682
MugundaMan wrote:
Gathige wrote:
The best point to capture tax is at source of income. This is also the most efficient and cost effective point devoid of kick backs. Tax collection through fishing when you catch a suspect and they try to deduce the tax due is counterproductive in the long run.


Seconded.
Also I like KRA's method of collecting a flat rate of 10% on rental income up to a certain threshold. Has really streamlined things. If only they could get rid of the cumbersome ITAX app and create one that is straightforward and time saving. Filing rental income returns on ITAX is like trying to put together a jigsaw puzzle.

Some free advice to Unyee if he wants to curb corruption in Kenya and make KRA revenues soar big time overnight

1. Expand the need for KRA PIN to almost everything in order to widen the tax net. Want your child to join std 1 - toa KRA pin, want to access any single government service; toa PIN, Want to get married, toa PIN. Want your water or stima connected, toa PIN. You get the point.

2. Huge sums of bank balances in any account (say cash balances of over kshs 100 million) should be automatically flagged and deposits into said account subject to scrutiny/reporting by the bank on a monthly basis.

3. Since 90% of the Kenyan economy is informal. Tax at a flat rate per individual/business instead of applying taxes progressively as is done in the formal sector. I hear Nairobi County is switching to this. If this is so, this is a masterstroke. Instead of hoping say a kiosk owner will report all their income (they wont) better to charge them a flat rate fee based on anticipated revenues for the year. E.g 25,000 kshs flat tax for a kiosk owner, but payable in installments. If they claim they did not generate enough revenue to meet the minimum bogey, let them prove it with their receipts, bank deposits, MPESA records etc in order to get the correct assessment.

4. Impose a 50% "unexplained income" tax on bank accounts. If someone makes a 50m cash deposit using gunias in a single day and has no convincing paperwork to prove where they got it. Tax it at 50% while investigations go on, or until the person proves the source of income.

5.Require a KRA PIN and KRA tax compliance certificate for every Kenyan flying into the country from abroad, as part of the entry requirements. This will net all diaspora tax evaders overnight (there are millions of them).

6. Lifestyle audit an absolute MUST for every public servant, in which assets and incomes are explained and audited in depth. 100% tax imposed on any unexplained assets or resources.

7. Conviction by a court of law for grand corruption above a certain threshold (say 1 million kshs) should automatically lead to a 50% gross tax on any and all assets the invididual owns, whether or not they were part of the proceeds of corruption.

8. KRA should pay people 10% of taxes netted on giving information that leads to the netting of a tax evader. Let's say your neighbour has an illegal duka next to you and you report them to KRA, if KRA captures 50,000 kshs worth of lost tax revenue, you will be paid kshs 5000. Make being an informant a full time job for the millions of unemployed youth around the country.

9. Parade grand corruption convicts in handcuffs and in their underwear up and down Kenyatta Avenue once a week
and broadcast live on all TV stations, before promptly returning them to Kamiti, then repeating the same the next week until the sentence is complete

Hayo tu



Nice vigilante justice, but if you want to replace grand corruption with grand inflation, that is how you would do it
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