How to File KRA NIL Returns 2025/2026
Every tax season, Kenyans must file their taxes, and during this time, many receive penalties not because they lack income, but because they fail to file NIL returns.
Filing NIL returns matters a lot, since it preserves tax compliance and avoids penalties, prevents unnecessary audits, and keeps you eligible for services that require a clean tax record, such as loans and tenders.
What are KRA NIL Returns
KRA NIL returns are the tax declarations filed with the Kenya Revenue Authority (KRA) by taxpayers who had no taxable income or transactions during a given tax year; therefore, by filing a NIL return, this signals to KRA that you recorded no income and keeps your tax record current.
Every person with a KRA pin is required to file annual returns, even if they earned no income during the tax year. Common filers include students, the unemployed, dormant businesses, and PIN holders with no taxable transactions. If, for any reason, you fail to file your NIL returns on time. You are subject to a penalty of KES. 2,000.
Requirements Before Filing NIL KRA NIL Returns
Step-By-Step Guide to Filing NIL Returns
- Visit the iTax portal, and log in with your national ID or KRA PIN.
- After logging in, you will be greeted with a simple user interface
- Select returns from the menu, then select file returns
- On the next page, select your tax obligation if you are a resident or not, then click next.
- On the next page, the return period from and the return period to will automatically populate if you have been consistently filing your returns.
- A pop-up message will pop up, read it, and click OK, and you will have filed your return
- Click on the link below and download the return receipt.
5 Common Mistakes to Avoid While Filing for KRA Returns
There are common mistakes to avoid when filing tax returns, regardless of whether you are submitting NIL returns or not.
Mistake number one is filing a NIL return when you actually have earned income, such as from a side hustle, rental income, or online activities. While this might seem easier, it is a risky choice. To avoid this mistake, you should accurately register your tax obligations and report your income correctly.
The other mistake is declaring gross income without deducting allowable expenses, especially for business owners. To correct this, maintain accurate records and deduct those expenses to legally reduce your tax burden.
Mistake number three is neglecting your withholding tax certificate (WHT), which represents money you have already paid to the Kenya Revenue Authority (KRA). It's important not to leave this unclaimed. To remedy this, log in to your account, download your withholding tax certificate, and apply the credits when filing your taxes.
The fourth mistake is incorrectly categorizing different types of income. For example, some individuals report rental income under the business section or forget to include their employment income altogether. To correct this, ensure that you file each type of income in the appropriate section separately, such as rental, employment, business, and so on.
The fifth common mistake many Kenyans make is believing that if they have no income, they are not required to file tax returns. However, even if you are unemployed, a student, or living abroad, the Kenya Revenue Authority (KRA) still expects you to submit a NIL return. To avoid penalties and complications with the system, make sure to file a NIL return regularly.
Benefits of Filing KRA Returns
Filing a tax return is essential, even before you apply for a tax refund. It helps you determine how much the Kenya Revenue Authority (KRA) owes you. A tax refund can occur if you were not taxed on your salary or if you did not take full advantage of the deductions and tax credits you are entitled to.
Secondly, filing a tax return enables you to know if you have any tax due, and if so, by how much.
Furthermore, if you are a business registered for VAT, filing your tax returns allows you to carry forward any tax credits from one month to the next. Generally, filing tax returns is a way of enhancing transparency and compliance.
Rights and Obligations of a Taxpayer
Rights
A taxpayer has the right to accurate and complete information, which includes information as required by law and tax obligations.
Secondly, a taxpayer has the right to ask questions, which entails the right to question any information or advice given by the KRA officers.
Taxpayers have the right to fair application of the law, and it is the responsibility of the Kenya Revenue Authority to ensure the accurate collection of taxes.
When accessing KRA services, taxpayers are entitled to courtesy and consideration, provided they are honest. This means you have the right to fair and non-discriminatory treatment in all matters related to the KRA. The KRA operates under the assumption that taxpayers are honest unless there is evidence to suggest otherwise.
The taxpayer has a right to privacy and confidentiality, which means that any information provided to KRA will be used to carry out lawful duties. In addition to that, you have the right to consistency and equity. This means that KRA will apply all laws consistently so that everyone can pay the right amount of taxes.
As a taxpayer, you have the right to request identification from a KRA staff member when visiting their premises. Additionally, you have the right to representation.
Obligations
As a taxpayer, you are entitled to obligations that you are supposed to fulfill. First, you should register for a personal identification number, and you register this via the iTax portal kra.go.ke.
If you are a business person registered for VAT, you are obligated to install and operate an electronic tax register (ETR) so that you can account for your VAT.
The third obligation is to file your tax returns promptly, depending on your tax obligations. For instance, if you are registered for VAT, you must file by the 20th day of the following month.
Fourth, you have an obligation to cooperate with KRA officials as they deal with their lawful duties, and finally, you have the responsibility to give relevant information, records, and documents needed by KRA when they are carrying out their official duties.
FAQs
Can I file NIL returns via mobile?- Yes, KRA has a dedicated mobile application.
What if I had income? You must file your regular tax returns even with a low income. Additionally, having a tax exemption certificate does not exempt you from filing nil returns.
When is the deadline? The deadline for filing your KRA tax returns is usually on the 30th of June unless otherwise stated.
Conclusion
Filing NIL returns is a straightforward yet important process; hence, it is essential to file your NIL returns to avoid potential penalties that could impact you in the future. There are several benefits to filing your returns: you can easily request a refund, stay informed about your tax liabilities, and carry forward any tax credits.
Always stay vigilant to avoid penalties from the Kenya Revenue Authority (KRA). Ensure you file your tax returns every year before June 30th. If you encounter any issues, doing this in advance gives you ample time to resolve them before the deadline. Additionally, it's important to download your receipts and keep them in a safe place.
