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KENYA

The Tax Procedures Act, 2015





Chapter 16

Security for tax due (s.36)

The Commissioner has powers to

  • demand for security (s.36)

  • Direct land registrar to place a mortgage or charge on taxpayer’s property or interest there on. (s.40)

  • This is subject to any prior mortgage or charge

  • Issue a distress order for recovery of unpaid tax or by sale of moveable property. (s.41(1))

  • Property may be sold by

    1. Private treaty
    2. Public auction
Bank accounts & debtors - Agency notice (s.42)

The Commissioner has powers to direct (s.42)

  • Banks to pay from account balances (s.42(2b))

  • debtors to pay to the commissioner (s.42(2a))

  • any other third party to pay to the Commissioner (s.42(2c,d))

  • Employers may be required to make a deduction to the commissioner for unpaid tax (s.42(3))

  • Maximum deduction to be 20% after tax

Failure to transfer/deduct, agent/payer to be liable. (s.42(13))

Appointment of VAT Witholding Agent (s.42A)- FA 2016

The Commissioner has powers to (s.42A)

  • appoint a person to withhold six percent (6%)(FA 2019 2%) at the time of paying of the supplies (s.42A(1))

  • revoke the appointment any time at his discretion (s.42A(2))

  • exempt a supplier with a potential contiuous credit position of 24 months or more from these provisions.(s.42A(4A))

Amounts to be remitted on or before the 20th of the following month.(s.42A(4B))

Official aid-funded projects are exempt from these provisions. (s.42A(3))

Failure to withhold and /or remit, agent/payer to be liable to 10% of amount involved. (s.42A(4D))

In addition, previous WHV agents appointed under s.25A of VAT Act 2013 are automatically deemed WHV agents under TPA 2015. No penalties are to apply between 19th January and 8th June 2016 when a lacuna in law existed after the TPA 2015 repealed s.25A of VAT Act 2013(s.42A(5))




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