Treasury Cabinet Secretary John Mbadi has defended a proposal in the Finance Bill 2026 that seeks to shorten the period within which taxpayers file annual income tax returns, saying the move is intended to improve tax administration efficiency and not to burden taxpayers.
Under the current system, individuals and businesses are required to file their annual tax returns within six months after the end of the financial year. The proposed amendment would reduce this window to four months, effectively moving the deadline from June 30 to April 30 for taxpayers whose financial year ends in December.
Mbadi explained that the proposal aims to align tax compliance timelines with modern revenue collection systems and improve the government's ability to plan and manage public finances. He noted that advances in digital tax systems have made it easier for taxpayers to prepare and submit returns earlier than before.
The Finance Bill also proposes that taxpayers with no tax payable file their returns within one month after the end of the relevant year of income. Additionally, the Kenya Revenue Authority (KRA) would be empowered to generate pre-populated tax returns using information already available in its systems, reducing the filing burden on taxpayers.
However, tax experts have raised concerns that a shorter filing period could put pressure on businesses and taxpayers, particularly if KRA systems are not adequately prepared to handle increased activity within the compressed timeframe. The proposal is currently under public participation before Parliament considers its final adoption.
Under the current system, individuals and businesses are required to file their annual tax returns within six months after the end of the financial year. The proposed amendment would reduce this window to four months, effectively moving the deadline from June 30 to April 30 for taxpayers whose financial year ends in December.
Mbadi explained that the proposal aims to align tax compliance timelines with modern revenue collection systems and improve the government's ability to plan and manage public finances. He noted that advances in digital tax systems have made it easier for taxpayers to prepare and submit returns earlier than before.
The Finance Bill also proposes that taxpayers with no tax payable file their returns within one month after the end of the relevant year of income. Additionally, the Kenya Revenue Authority (KRA) would be empowered to generate pre-populated tax returns using information already available in its systems, reducing the filing burden on taxpayers.
However, tax experts have raised concerns that a shorter filing period could put pressure on businesses and taxpayers, particularly if KRA systems are not adequately prepared to handle increased activity within the compressed timeframe. The proposal is currently under public participation before Parliament considers its final adoption.
