The 2019 Finance Act has re-introduced the turnover tax at the speed of 3% of the gross income. This tax was repealed by the Finance Act, 2018, and is applicable to any resident person whose annual turnover is below Kshs.5 million. Turnover tax is currently a monthly obligation collectible on or before the twentieth day of the subsequent month.
Resident persons susceptible to pay turnover tax also are needed to pay a presumptive tax at the rate of 15% of the quantity payable for a business allowed or commerce license issued by the county government.
The informal sector has been the key to economic development in several nations around the world. it’s on this basis that the govt of the African country has introduced turnover on small-scale traders normally named as Juakali sectors. the complete principle around introducing the tax is to spread the tax burden across as many Kenyans as possible.
The final rule of taxation is that the compliance method has been created as straightforward and simple to administer. whereas the compliance process of filing and submission of turnover returns on i-Tax could also be cumbersome for many of the informal business house owners who aren’t tech-savvy, compliance is achieved in the following ways;
begin by acknowledging that your business is subject to the tax if it makes under 5,000,000 once a year on gross sales. there’s no have to be compelled to look ahead to the long arm of the bureaucrat to point out up at the doorstep for failing to comply. KRA is functioning with the native county governments to understand what number of businesses are given licenses. this can be wont to track what number of businesses are in operation. The taxpayers that may be eligible for the Turnover Tax (TOT) ought to keep daily sales records that will facilitate the computation of the TOT each month. If doing all of this on your own proves difficult, you’ll rent the services of a businessperson to be submitting the taxes for you. For additional data contact;
