How to Pay KRA Penalties via M-Pesa

Understanding KRA Penalties in Kenya

The Kenya Revenue Authority (KRA) mandates all registered taxpayers to comply with tax regulations. Failure to meet these obligations results in financial penalties, which vary depending on the nature of the tax offense. Below is a breakdown of common penalties imposed by KRA:

1. PAYE Non-Compliance

Offense: Failure to deduct, account for, or submit PAYE certificates
Penalty: 25% of the tax amount or Ksh 10,000 (whichever is higher)

2. Withholding Tax Default

Offense: Failure to deduct or remit withholding tax
Penalty: 10% of the tax due (capped at Ksh 1 million)

3. Stamp Duty Late Payment

Offense: Delayed Stamp Duty payment
Penalty: Additional 5% per quarter from the due date

4. Excise Duty/VAT Default

Offense: Late or unpaid Excise Duty/VAT
Penalty: 5% of the tax due or Ksh 10,000 (whichever is higher)

5. Late Tax Payment

Offense: Missing tax payment deadlines
Penalty: 20% of the outstanding tax

6. Late Annual Returns Filing

Offense: Failure to submit annual returns on time
Penalty: 5% of the normal tax or Ksh 10,000

7. KRA PIN Violations

Offense: PIN-related offenses
Penalty: Ksh 2,000 per violation

Step-by-Step Guide to Paying KRA Penalties via M-Pesa

Follow these simple steps to settle your KRA penalties conveniently using M-Pesa:

Step 1: Log into Your KRA iTax Portal

Visit https://itax.kra.go.ke/
Enter your KRA PIN and password to access your account.

Step 2: Generate a Payment Registration Number (PRN)

Navigate to Payments > Payment Registration
Fill in the required details (tax obligation, penalty amount, etc.)
Submit the form and download the E-slip, which contains your PRN.

Step 3: Make Payment via M-Pesa

Open your M-Pesa menu on your phone.
Select Lipa na M-Pesa > Paybill.
Enter the following details:
- Business No: 572572
- Account No: Your PRN (from the E-slip)
- Amount: The penalty amount due
Enter your M-Pesa PIN and confirm the transaction.
You will receive an SMS confirmation from M-Pesa and KRA.