Key Changes to 2025 Income Tax Filing — KRA Commissioner Explains What Taxpayers Need to Know


 The Kenya Revenue Authority (KRA) has outlined a series of significant updates and procedural changes that will shape the 2025 income tax filing season — many of which will directly affect how individuals and businesses prepare, validate and submit their annual returns.

1. Shift to Pre-Populated Returns

For the 2025 filing year, KRA is accelerating its drive toward automation. A growing number of taxpayers — especially salaried individuals and those with employer-reported income — will find their returns pre-populated with information already available on KRA systems. Taxpayers are expected to review, verify and confirm these records rather than fill in every detail manually. What to do: Log into iTax early, reconcile reported income and deductions, and ensure accuracy before submission.

2. Enhanced Data Validation Requirements

In line with its data-driven compliance strategy, KRA will validate declared income and expenses against multiple data sources — including employer PAYE filings, withholding tax figures, customs records, and eTIMS/TIMS invoices. All declared expenses and income must match corresponding electronic invoices and system records. This means:

  • Expense claims must be backed by valid eTIMS-generated invoices where applicable.
  • Misalignment between declared amounts and registered system records may trigger audits or return rejections. Businesses should audit supplier invoices early to avoid denied deductions and penalties.

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3. Nil Return Filing Changes

In response to rampant misuse of nil return declarations, KRA temporarily suspended the option to file nil returns for 2025 and has set a new re-opening date of 31 March 2026. Only taxpayers who genuinely had no income in 2025 will be eligible to use this option once reinstated. Implication: Nil filers must prepare documentation to justify their status if audited.

4. Phased Filing Approach

To streamline compliance and reduce systemic bottlenecks, KRA has begun adopting a phased filing process, grouping taxpayers by complexity and income type. This is intended to spread workload and improve system performance during peak filing periods.

5. Increased Compliance Scrutiny

The Authority’s enhanced validation protocols are part of a broader push to expand the tax base and reduce under-declaration. KRA’s ongoing efforts include more rigorous verification of employer-reported data and integration with third-party financial records.

What This Means for Taxpayers

Individuals: Expect less manual data entry but more responsibility to verify the accuracy of pre-populated figures. 

Businesses: Must invest in robust record-keeping, ensure complete eTIMS compliance, and reconcile supplier invoices before filing.  

All Filers: Should begin reviewing and preparing returns well ahead of statutory deadlines to avoid last-minute system delays and compliance issues

For support and advice, contact RWK Africa — your partner in tax compliance.

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