Learn about the KRA Turnover Tax (TOT) in Kenya online today. Get to know more about Turnover Tax (TOT) in Kenya and the Businesses supposed to pay the tax.
By now, if you own and run a business in Kenya you already know that starting this year, businesses whose gross sales per year is less than Kshs. 5,000,000.00 are supposed to be paying Turnover Tax (TOT) on the gross sales for the previous month on or before the 20th day of the month.
In today’s article, I am going to continue from where I left off. If you can recall, I had written earlier about the Presumptive Tax in Kenya and you can check the article on The Complete Beginner’s Guide To KRA Presumptive Tax In Kenya. This is the last part of the two part blog series as Presumptive Tax and Turnover Tax (TOT) are like siamese twins, they go hand in hand with each other. You can also refer to these two new tax regimes as “The New Sheriffs in Town.” So today I am going to share about the KRA Turnover Tax (TOT).
According to a Public Notice issued by the Kenya Revenue Authority (KRA) dated 06/01/2020, Turnover Tax (TOT) has officially come into effect starting January 2020 and Kenya Revenue Authority (KRA) is requesting all eligible taxpayers to pay the Turnover Tax (TOT). If your business annual sales is Kshs. 5,000,000.00 and below, then Turnover Tax (TOT) is the right tax obligation for you. Remember, Turnover Tax (TOT) is 3% of the monthly gross sales of your business.
According to Kenya Revenue Authority (KRA), all Kenyans will now be paying their fair share of taxes. Following the recent amendments to the Finance Act Law, the Government of Kenya has introduced a simpler tax regime for Micro and Small Enterprises (MSEs) whereby they will be paying taxes through simplified processes including mobile payment platforms.
Under the simplified Turnover Tax (TOT) regime, taxpayers will not be required to prepare complex records of accounts. The taxpayers that will be eligible to the Turnover Tax (TOT) will only be required to keep a daily gross sales records.
As per Kenya Revenue Authority (KRA), it is the responsibility of every citizen to contribute towards the development of the Country through payment of all the relevant taxes as stipulated by the Law. The re-introduction of the Turnover Tax (TOT) will fairly spread the responsibility of developing the country to all citizens and residents of Kenya.
We shall be looking at the key aspects of the Turnover Tax in Kenya such as; What Is Turnover Tax (TOT), Benefits of Turnover Tax (TOT), Who Is Excluded From Payment Of Turnover Tax (TOT), Can A Taxpayer Choose Not To Be Subject To Turnover Tax (TOT), Is Turnover Tax (TOT) Final Tax, What Is The Rate of Turnover Tax (TOT), How To Register For Turnover Tax (TOT) and How To File And Pay For Turnover Tax (TOT) Through iTax Portal.