How To File KRA Returns With a P9 Form
Filing tax returns using P9 forms is a mandatory process for all employees in Kenya, but the process can be confusing for many. Whether you are employed or unemployed, tax returns must be filed by June 30th each year, and failure to do so incurs a penalty of either 5% of the tax due which is equivalent to around Ksh. 20,000.
There are two types of returns: Income tax returns which require P9 forms for employed individuals, and Nil Returns for the unemployed, Note, even if you are unemployed you should file nil returns to avoid penalties.
What is a P9 Form?
A P9 form is simply a tax-deduction form employers issue to their employees. It contains information on basic salary, benefits, allowances, pension contributions, gross pay, tax charges, and personal relief for the entire year.
To file returns using a P9 form, you must follow these steps:
1. Visit the KRA iTax portal operated by the KRA.
2. Log in to your iTax account using your KRA pin and password and also by completing a simple numeric calculation.
3. Click on the Returns tab and select File Return.
4. Choose your tax obligations (Income Tax-Resident Individual) and click Next.
5. Download the Income Tax Resident Individual Form and fill in the tabs with basic information, employment income, details of the PAYE deducted, and tax computation (Personal Relief).
6. Click on the validate button to validate the data on the Income Tax Resident Individual Excel Sheet.
7. Upload the Excel Sheet and click on the submit button.
8. Lastly, download the KRA eReturn Acknowledgment Receipt.
NOTE: A negative after your KRA Returns means that you are supposed to be refunded by KRA, while a positive figure means you owe KRA and must pay.
Filing Nil Returns
If you have no source of income, you must file Nil Returns instead of using a P9 form. Here are the steps to follow:
1. Go to the KRA iTax Portal.
2. Enter your KRA Pin and Password.
3. Go to the Returns menu and select File Nil Returns.
4. Choose your type of taxation and tax obligation, then enter your KRA Pin.
5. Provide your details and the return period.
6. Complete the process and submit.
7. Download the acknowledgment receipt.
To sum up, it's crucial for employees to learn how to file returns using a P9 form to avoid penalties. Unemployed individuals must also file annual Nil Returns to avoid hefty penalties.
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