KRA re-opens Tax Amnesty: What does it mean for millions of Kenyans?

Have you come across conversations about KRA's latest Tax Amnesty Program?

The initiative, which took effect on July 1, is one of the key tax relief measures introduced under the Finance Act, 2026.

It gives eligible taxpayers until December 31, 2026, to settle qualifying tax obligations while enjoying a waiver on penalties, interest and fines.

Who stands to benefit?

The programme targets individuals and businesses with tax liabilities that arose on or before December 31, 2025.

If you had already paid your principal tax by that date but your account still reflects penalties or interest, KRA says those charges will be waived automatically - meaning there's no need to submit a separate application.

There's also relief for taxpayers who don't owe any principal tax but have accumulated late filing penalties. Once all outstanding returns are filed, eligible penalties can also be waived automatically.

There's a catch

While many Kenyans are celebrating the announcement, KRA has made one thing clear: the tax itself isn't being written off.

The amnesty only applies to the extra charges that have accumulated over time - namely penalties, interest and qualifying fines.

Anyone with unpaid principal tax for periods before January 1, 2026, must first settle the outstanding amount before qualifying for the waiver.

Those who pay the full principal tax during the amnesty period will have the related penalties and interest removed.

Can't pay everything at once?

Recognising that some taxpayers may struggle to clear large tax bills immediately, KRA has also introduced structured payment plans through the iTax platform.

However, there's a deadline. Any payment arrangement must still result in the full principal tax being paid by December 31, 2026, for the taxpayer to enjoy the amnesty.

Why now?

The programme comes as the government looks to improve tax compliance while giving taxpayers an opportunity to regularise historical tax obligations.

Previous tax amnesty programs helped recover billions of shillings in principal tax while enabling thousands of taxpayers to clean up their tax records.

The latest initiative builds on that approach as the government seeks to boost revenue without imposing additional penalties on those willing to come forward voluntarily.

What should taxpayers do?

KRA is urging taxpayers not to wait until the last minute.

Instead, it advises them to log into their iTax accounts, review any outstanding liabilities and confirm whether they qualify for the amnesty.

With the programme running until the end of December, eligible taxpayers have a six-month window to settle outstanding principal tax and take advantage of the relief on penalties and interest.