, is an agency of the Government of Kenya that is responsible for the assessment, collection and accounting of all revenues that are due to the government in accordance with the laws of Kenya. Kenya Revenue Authority Glossary.){kind=link}
Kenya Revenue Authority (KRA), is an agency of the Government of Kenya that is responsible for the assessment, collection and accounting of all revenues that are due to the government in accordance with the laws of Kenya. Kenya Revenue Authority Glossary.
| Website | http://www.kra.go.ke/ |
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The Kenya Revenue Authority (KRA) was established by an Act of Parliament, the Kenya Revenue Authority Act, which became effective on 1 July 1995. The Authority is charged with collecting revenue on behalf of the Government of Kenya.
The Authority’s core operations are:-
- To assess, collect and account for all revenues in accordance with the written laws and the specified provisions of the written laws.
- To advise on matters relating to the administration of, and collection of revenue under the written laws or the specified provisions of the written laws.
- To perform such other functions in relation to revenue as the Cabinet Secretary responsible for matters relating to finance may direct.
Here are the Kenya Revenue Authority Glossary term Meanings
What is Agency fees?
Payments made to a person/agent for acting on their behalf of another person.
What is Annuity Contract?
A contract providing for the payment of an individual of a life annuity.
What is Annuity?
An insurance product offered to people. An individual is paid a fixed sum of money each year, typically for the rest of their life. It can be used as a retirement strategy to get steady streams of money.
What is Assessment?
It is an exercise we conduct to obtain the value of your property, assets usually for purposes of calculating tax due.
What is Appealable decision?
Thismeans an objection decision and any other decision made under a tax law.
Who is an Authorised officer?
This is an officer appointed by the Commissioner under the Kenya Revenue Authority Act.
What is Approved place of loading/unloading?
This means any quay, jetty, wharf, or other place, including any part of a Customs airport, appointed by the Commissioner by notice in the Gazette to be a place where goods may be loaded or unloaded.
What is Ad valorem tax?
A tax on goods or property expressed as a percentage of the sales price or assessed value.
What is Allowance?
An amount of money paid to persons to meet their expenses. It also refers to deductions made when computing income taxes to attain the taxable income
What is Avoidance?
It is a legal methodology used to lower the amount of tax liability
What is Arm’s length transaction?
A transaction among parties, each of whom acts in his or her own best interest.
What is an Audit?
An examination of a tax return by tax authorities at the taxpayer’s place of business.
What is Balance of Tax?
It refers to the remainder of tax to be paid when paying instalment tax. The balance of the tax is payable by the last day of the 4th month after the end of the year of income.
What is a Boarding station?
This means any place appointed by the Commissioner by notice in the Gazette to be a place for aircraft or vessels arriving at or departing from any port or place to bring to for the boarding by or the disembarkation of officers.
What is a Balance sheet?
Statement of the financial position of a business as of a particular date. The statement will show the business’s assets in one column and its liabilities and owner’s equity in another column.
What is Casual employment?
Any engagement with any one employer which is made for a period of less than one month, the emoluments of which are calculated by reference to the period of the engagement or shorter intervals.
What is Current year of income?
Refers to income charged to instalment tax. Means the year of income for which the instalment tax is payable.
What is Cargo?
This includes all goods imported or exported in any aircraft, vehicle or vessel other than such goods as are required as stores for consumption or use by or for the aircraft, vehicle or vessel, its crew and passengers, and the bona fide personal baggage of such crew and passengers.
What is COMESA?
This means the organisation established by the Treaty establishing The Common Market for Eastern and Southern Africa, 1994.
What is Countervailing duty?
This means a specific duty levied for the purposes of offsetting a subsidy bestowed directly or indirectly upon the manufacture, production or export of that product.
What is Countervailing measure?
This means actions taken to counter the effect of subsidies.
What is a Customs area?
This means any place appointed by the Commissioner by notice in writing under his or her hand for the deposit of goods subject to Customs control.
What is Customs revenue?
This means any amounts collectable by the Customs in accordance with the provisions of the Customs laws.
What is Customs warehouse?
This means any place approved by the Commissioner for the deposit of unentered, unexamined, abandoned, detained, or seized, goods for the security thereof or of the duties due thereon.
What is a Company?
A legal entity (a corporation) organized to perform an activity, business or industrial enterprise.
What is Double Taxation Agreements?
(DTA) are international agreements concluded between two jurisdictions to allocate taxing rights between two countries.
What is Double Taxation?
They are agreements between Kenya and other countries that lessens the tax burden on citizens and corporation of each country.
What is a Document Processing Centre?
(DPC): was established to replace the traditional Long Rooms countrywide. It is a One Stop Centre for online document processing and validation.
What are Dividends?
A payment made by a corporation to its shareholders, usually as a distribution of profits. When a corporation earns a profit or surplus, the corporation is able to re-invest the profit in the business (called retained earnings) and pay a proportion of the profit as a dividend to shareholders.
What is Debenture?
It includes debenture stock, a mortgage, mortgage stock or any similar instruments acknowledging indebtedness, secured on the assets of the person issuing the debenture.
What is Discount?
This means interest measured by the difference between the amount received on the sale, final satisfaction or redemption of any debt bond, loan, claim, obligation or evidence of indebtedness and the price paid on purchase or original issuance of the bond or evidence of indebtedness or the sum originally loaned upon the creation of the loan, claim.
What is Dividend?
This means any distribution (whether in cash or property, and whether made before or during a winding up) by a company to its shareholders with respect to their equity interest in the company, other than distributions made in complete liquidation of the company of capital which was originally paid directly into the company in connection with the issuance of equity interests
What is Due date?
This means the date on or before which tax is due and payable.
What is Duty drawback co-efficient?
means the amount of duty refundable per unit of goods exported.
What is Duty drawback?
This means a refund of all or part of any import duty paid in respect of goods exported or used in a manner or for a purpose prescribed as a condition for granting duty drawback.
What are Dutiable goods?
This means any goods chargeable with duty.
What is Duty?
This includes any cess, levy, imposition, tax, or surtax, imposed by any Act
What is Demurrage?
It refers to a fee charged for the amount of days that an import container is under the control of the shipping, carrier, port, or Railroad Company for the storage of containers or rail cars that exceed free time offered.
What is Deductions?
An item which is subtracted (deducted) in arriving at, and which therefore reduces, taxable income.
What is Deferment of tax?
The postponement of tax payments from the current year to a later year.
What is Deferred income?
Term used to describe income which will be realized at a future date, thus delaying any tax liability.
What is Dividends?
A payment by a corporation to shareholders, which is taxable income of shareholders. Most corporations receive no deduction for it.
What is Duty?
Customs duties levied on imported products.
What is Duty-free zone?
A designated area at an international airport or port where imported goods may be unloaded, stored and reshipped without payment of customs duties or other types of indirect taxes, provided the goods are not imported.
Who is an Employer?
Includes any resident person responsible for the payment of, or on account of, emoluments to an employee, and an agent, manager or other representative so responsible in Kenya on behalf of a non-resident employer.
What is an Export processing zone?
This means a designated part of Customs territory where any goods introduced are generally regarded, in so far as import duties and taxes are concerned, as being outside Customs territory but are restricted by controlled access.
What is Employment income?
Income source of individuals, covering income derived from labour or other current or former dependent personal services such as salaries, wages, bonuses, allowances, and compensation for loss of office or employment, pensions and, in some countries, certain social security benefits.
What is an Estate?
Broadly, all that a person owns, whether real property or personal property, for instance, the estate one leaves at death.
What is Exemptions?
Tax laws frequently provide specific exemptions for persons, items or transactions, etc. which would otherwise be taxed. Exemptions may be given for social, economic or other reasons.
What is Final Tax?
Under tax treaties the withholding tax charged by the country of source may be limited to a rate lower than the rate which would be charged in other circumstances – this reduced rate is then the final tax in the country of source.
What is Foreign Tax?
In relation to income charged to tax in Kenya, means income tax or tax of a similar nature charged under any law in force in any place with the government of which a special arrangement has been made by the Government of Kenya and which is the subject of that arrangement.
What is Franking?
This is the process used to affix any type of mark or stamp to a paper to indicate that the stamp duty has been paid.
What is a Foreign port?
This means any port in a foreign country
What is Gross income?
It refers to the amount of money a person earns in one year derived from a trade, business or services, including interest, dividends, royalties, rentals, fees or otherwise before taxes.
What is a Government warehouse?
This means any place provided by the Government of a Partner State, and approved by the Commissioner, for the deposit of dutiable goods on which duty has not been paid and which have been entered to be warehoused.
What is a Green Channel?
This means that part of the exit from any customs arrival area where passengers arrive with goods in quantities or values not exceeding those admissible.
What is an Invoice?
A statement that summarizes the total amount for services rendered or list of goods supplied.
What is Interest?
A fee that is charged by a lender to a borrower for the right to use the borrowed funds. The funds can be used to purchase a house, a car, or goods that were charged on a credit card, for example. The interest charge typically is expressed as an annual percentage rate.
Who is an Incapacitated person?
To be in a state of unsoundness of mind.
What is Individual retirement fund?
This means a fund held in trust by a qualified institution for a resident individual for the purpose of receiving and investing funds in qualifying assets in order to provide pension benefits for such an individual or the surviving dependents of such an individual subject to the Income Tax (Retirement Benefit) Rules
What is an Internal Container depot?
ICD means any place appointed and licensed by the Commissioner for the deposit of goods subject to customs control.
What is an International organisation?
This is an organisation with international membership, scope or presence and the membership are sovereign powers or the governments of sovereign powers.
What are Import duties?
This means any customs duties and other charges of equivalent effect levied on imported goods.
What is Jurisdiction?
The power, right, or authority to interpret and apply tax laws or decisions.
What are Losses?
The excess of expenses over revenues for a period, or the excess of the cost of assets over the proceeds when the assets are sold or otherwise disposed of, or abandoned or destroyed.
What is Management or professional fee?
A payment made to a person, for services rendered in managerial, technical, agency or consultancy services.
What is Manufacturing under bond?
This is a facility extended to manufacturers to import plant, machinery, and equipment and raw materials tax free, for exclusive use in the manufacture of goods for export.
What is Net income?
Net income is gross income less deductible income-related expenses.
What is Penalty?
A punitive measure that the law imposes on taxpayers who fail to diligently file and pay for their statutory taxes.
What is a Partnership?
It is a type of business or organisation whereby two or more people cooperate to manage and operate a business.
What is Per Diem?
Daily allowance, usually for travel, entertainment, employee compensation, or miscellaneous out of pocket expenses incurred while conducting a business transaction.
What is Profit?
The excess of revenue over expenditure
What is a PIN?
Personal Identification Number (PIN) is a number which identifies a person for purposes of transacting business with Kenya Revenue Authority, other Government agencies and service providers. It is processed by Domestic Tax Department.
What is a Prescribed Form?
A set down legal document that has been set down to be used for a particular action.
What is a Port?
This is any place, whether on the coast or elsewhere, appointed by the Council by notice in the Gazette, subject to any limitations specified in such notice, to be a port for the purpose of the Customs laws and, in relation to aircraft, a port means a Customs airport.
What is a Post Office?
This is a Partner State Posts body established in accordance with a Partner States’ Communication law.
What are Prohibited goods?
This is any goods the importation, exportation, or carriage coastwise, of which are not allowed/ forbidden by law.
Who is a Resident individual?
Has a permanent home in Kenya and was present on Kenya for any period in a particular year of income under consideration; or has no permanent home in Kenya but-
- was present in Kenya for a period or periods amounting to the aggregate to 183 days or more in that year of income; or
- was present in Kenya in that year of income and in each of the two preceding years of income for periods averaging to more than 122 days in each year of income;
What is Resident company?
That the body is a company incorporated under a law of Kenya; or the management and control of the affairs of the body was exercised in Kenya for any year of income.
What is Registered individual retirement Fund?
An individual retirement fund where the trust deed for such a fund has been registered with the Commissioner.
What is Re-exports?
This are goods, which are imported and are under Customs control for re-exportation.
What is Red channel?
This is that part of the exit from any customs arrival area where passengers arrive with goods in quantities or values exceeding passenger allowance.
What is Refinery?
This is a bonded warehouse licensed by the Commissioner for the treatment of oils.
Who is a Registered user?
This is a person authorised to access the customs computerised system.
What is Restricted goods?
This is any goods the importation, exportation, transfer, or carriage coastwise, of which is prohibited but can be permitted under certain circumstances and is subject to approval of a competent authority.
Who is Sole Proprietor?
Referring to persons who work for themselves and are not employed by another. The owner-operator of a sole proprietorship or a partner is considered self-employed.
What is Stamp Duty?
Duty levied upon the issue of official documents, stamp duties are “levied” by way of a stamp being fixed to the document.
What is Smuggling?
This is the importation, exportation, or carriage coastwise, or the transfer or removal into or out of a Partner States, of goods with intent to defraud the Customs revenue, or to evade any prohibition of, or restriction.
What is Subsidy?
This is the assistance by a government of a Partner State or a public body to the production, manufacture, or export of specific goods taking the form of either direct payments, such as grants or loans or of measures with equivalent effect such as guarantees, operational or support services or facilities and fiscal incentives.
What is Sufferance wharf?
This is any place, other than an approved place of loading or unloading at which the Commissioner may allow any goods to be loaded or unloaded.
What is Tax Return?
This is a declaration made by taxpayers that summarizes their income, expenses and other pertinent tax information.
What is Tax Incentive?
A tax incentive is a tax a benefit that reduces tax liability or defer the payment of tax to a future date. These incentives are aimed at encouraging investments in the industry thereby creating employment directly and indirectly.
What is Tax offences?
They include late filing, late payment, and failure to declare taxable income or transactions, and negligent or fraudulent misstatements in tax declarations.
What is Tax Refund?
Also known as tax rebate is a refund on taxes when the tax liability is less than the taxes paid.
Who is a Tax Agent?
Tax adviser who assists the taxpayer in fulfilling their statutory tax obligation on their behalf.
What is a Tax clearance certificate?
It is a document we issue to taxpayers to certify that a taxpayer has fully cleared all their taxes.
What is Tax Compliance Certificate?
It is a certificate we issue to taxpayers to satisfy and confirm that they are compliant with all their statutory taxes as per their obligations.
What is Transfer Pricing?
They are rules and methods for pricing transactions within and between enterprises under common ownership or control. It can be used as a profit allocation method to attribute a multinational corporation’s net profit (or loss) before tax to countries where it does business.
What is Tax Law?
Any Regulations or other subsidiary legislation made under this Act or the Income Tax Act, Value Added Tax Act, and Excise Duty Act.
What is Tax decision?
A determination of the amount that a tax representative, appointed person, director or controlling member is liable for.
Who is a Tax representative?
A person who is the tax representative of the taxpayer.
What is Taxpayer?
A person liable for tax under a tax law whether or not they have accrued any tax liability in a tax period.
What is Transit?
This is the movement of goods imported from a foreign place through the territory of one or more of the Partner States, to a foreign destination.
What is Tax fraud?
It is a form of deliberate evasion of tax which is generally punishable under criminal law. The term includes situations in which deliberately false statements are submitted, fake documents are produced.
What is Unpaid Tax?
This means any tax that has not been paid by the due date or any late payment interest in respect of a tax liability.
What is Uncustomed goods?
This includes dutiable goods on which the full duties due have not been paid, and any goods, whether dutiable or not, which are imported, exported or transferred or in any way dealt with contrary to the provisions of the Customs laws.
What is Vessel?
Conveyance by water of human beings or goods.
What is Wharf owner?
This includes any owner or any occupier of any approved place of loading or unloading or of any sufferance wharf.
Who is a Warehouse keeper?
This is the holder of a licence granted in respect of a bonded warehouse
What is Zero Rate?
It refers to VAT, where goods and services that are taxable but the rate of tax is 0% on their input supplies.
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