KRA Issues New Income Tax Returns validation guide before the implementation of 2026

The Kenya Revenue Authority (KRA) has given a warning to the taxpayers against the forthcoming validation of the income and expenses reported on the tax returns.

The new verification process, which will be effective as of January 1, 2026, is among the current reforms carried out by the authority to improve the transparency and accuracy of tax reporting.

In a public communication dated Thursday, November 7, KRA announced to taxpayers, stakeholders, and the general population that starting in the year 2026, all income tax returns (both individual and business) will be validated automatically against the data received through a number of systems.

The exercise will be applied to returns for the 2025 year of income or the accounting period being prepared using the iTax platform.

The notice states that KRA will compare the declared income and expenses with three primary knowledge sources, which are TIMS/eTIMS invoices, withholding income tax records, and import declarations in the Customs system.

The authority opined that this integration will facilitate aligning the data taxpayers report with verifiable digital records, minimizing incompatibilities and forging claims. KRA also stressed that any reported income and expenses can no longer be supported by invalid electronic tax invoices that have not been duly sent via the TIMS (Tax Invoice Management System) or eTIMS (Electronic Tax Invoice Management System).

In cases where applicable, its invoices should contain the Personal Identification Number (PIN) of the buyer and be traceable and compliant. As a way of assisting the taxpayers to be ready, KRA has advised individuals and entities to seek TIMS/eTIMS schedules of their yearly earnings and expenditures with their respective account managers.

These schedules will be used as reference documents provided when making tax returns in the year 2025 and above. The notice added that KRA could receive feedback and input on the matter by the taxpayers and other stakeholders to ensure that the implementation of this validation process is smooth and effective.

Implementation of the Automated Payment Plan (APP). In conjunction with the new validation system, KRA has introduced the Automated Payment Plan (APP) that seeks to assist taxpayers to easily settling outstanding tax liabilities. The system, which will be available since November 7, 2025, enables taxpayers to pay their dues- principal tax, penalties, and accrued interest- by installment in a period of not more than six months. This online payment system is amidst wider modernization in KRA, whereby the organization seeks to enhance compliance and relieve taxpayers burdened temporarily by their cash flow situation. The taxpayers are able to set up individual repayment plans through APP and do this personally through the iTax platform, making it transparent and flexible. Improved Tax Compliance Certificate (TCC) Requirements.

In a similar action, KRA revealed in October 2025 that it has modified the Tax Compliance Certificate (TCC) application procedure to suit the new eTIMS/TIMS compliance framework.

With the new system, any individual or business seeking to apply to TCC must pass a number of qualifications. These include: Registration of all the entities involved in business activities in TIMS/eTIMS.

The submission of all the applicable tax returns on time within the respective deadlines. Full payment of any taxes due. Settlement or accepted plan of payment of any liabilities.

In the notice, KRA has announced that it has improved the TCC application to encompass compliance with eTIMS/TIMS with non-individual entities and people whose income is not employment income. The authority once again reminded that all unpaid taxes applicants would have to clear their outstanding balances or be placed on an approved payment plan using the APP system before they can continue using their applications to TCC.

Enhancing Technology in Compliance. The joint implementation of the validation process, the automated payment plan, and the improved TCC system highlights the expanded digital transformation program of KRA. The authority is in search of a transparent, efficient, and data-driven tax environment that would reduce fraud and increase revenue collection. Through the integration of technology and real-time data, KRA will simplify the process of compliance for honest taxpayers and discourage tax evasion by enhancing accountability and traceability.

Taxpayers are now being encouraged to get acquainted with these impending changes, review of their electronic invoicing, and ensure that all their transactions are well recorded prior to the 2025 income year.