Amid calls of amnesty by the Kenya Revenue Authority to individual landlords to file their taxes as from year 2013, the body has also hinted on a data matching and risk profiling solution system that will crackdown tax cheats by monitoring their bank accounts.
After the recent buzz of digital tax filing, KRA now has more automated tax payers than ever with a count of up to 2 million digitally recognized tax payers. As much as the number is looking up for the Authority body, KRA still faces challenges in tracking tax defectors due to the inaccurate system it has been using over the years therefore obstructing proper analysis which has in return prevented the revenue authority from bringing the defectors to book.
The new data matching system will link automated tax payers’ database to their bank accounts with the data warehouse and Business Intelligence that offers a single view of a taxpayer’s profile that links persons to third party system among which are banks and utility firms.
With system information exchange, KRA will be in a much better position to determine individual compliance. Besides singling out tax cheats, KRA will also track unreported activities of taxpayers as well as rank risk profiles amongst taxpayers.
KRA has been under pressure to collect taxes not only the struggle to reach this taxpayers but also time taken by the tax-collector. with the new system, time taken to collect these taxes will be reduced upto 30 per cent.
The government has also been up in arms in leveraging on sectors that could help heighten the country’s revenue to cater for upcoming projects like the standard gauge railway among other devolved government projects.
In the recent force applied by KRA, the authority through Finance Bill 2015, granted a tax amnesty for individual landlords on their rental income. The condition for qualification as stated by the authority body will be the full declaration of the rental income, online filing of the returns and payment of principal taxes for the years of income 2014 and 2015 immediately but not later than 30th June 2016.
For 2013 year of income and prior, there will be a 100% amnesty on principal taxes, penalties and interest. For 2014 and 2015 years of income, there will be 100% amnesty on penalties and interest. Landlords applying for amnesty will be issued with amnesty certificates upon confirmation and will not be required to apply for waiver of interest and penalties.