How to File your P.A.Y.E (Pay As You Earn) Returns

File your Withholding Tax Returns
File your Withholding Tax Returns

What is PAYE?

PAYE is a method of collecting tax from individuals in gainful employment. Gains or Profits includes wages, casual wages, salary, leave pay, sick pay, payment in lieu of leave, fees, commission, bonus, gratuity, or subsistence, traveling, entertainment or other allowance received in respect of employment or services rendered.

If you are an employer you are required to register for this obligation.

As an employer, you are required to deduct PAYE from your employees’ salaries and wages at the prevailing rates and remit the same to KRA on or before the 9th of the following month. 

How do I file for PAYE? 

PAYE returns are submitted online via iTax If you have no PAYE to declare, you are required to submit a NIL return.

How do I pay for PAYE? 

After filing the return online, you are required to generate a payment slip via iTax which you will present at any of the KRA appointed banks to pay the tax due. 

  1. You can make payments via Mpesa.
  2. Use the KRA Pay bill number 572572.
  3. The Account Number is the Payment Registration number quoted at the top right corner of the generated payment slip.

What is the penalty for late filing and paying?

Date: Return should be filed and tax payable on or before the 9th of the following month.

Penalty on late filing: Whichever is higher between, 25% of the tax due or Kshs. 10,000. 

Penalty on late payment: 5% of the tax due and late payment of 1% per month on the unpaid tax until the tax is paid in full.