Taxpayers should note that in case of any discrepancies between the Revenue Laws and this information, the Revenue Laws will take precedence.

The Finance Act 2023 has introduced a tax amnesty for interest and penalties on tax debt by incorporating Section 37E into the Tax Procedures Act, 2015. The amnesty applies to:

1. Individuals with penalties and interest but no principal taxes due for periods up to December 31, 2022.
2. Individuals with accrued principal tax up to December 31, 2022, who settle the outstanding principal tax debt by June 30, 2024.

The Finance Act, 2023 has also removed the provisions for tax waivers and abandonment, thus encouraging taxpayers to utilize the tax amnesty.

Purpose

These guidelines are designed to help taxpayers understand the implementation of the tax amnesty.

Eligibility

• Automatic Eligibility: Taxpayers with no principal tax due for periods up to December 31, 2022, but with penalties and interest due. No application is necessary.
• Application Required: Taxpayers with outstanding principal tax debts for periods up to December 31, 2022, must apply for amnesty and submit a payment plan for the outstanding taxes.

Taxpayers eligible include those with:

1. Self-assessments or amended assessments raised after December 31, 2022, provided the principal taxes are paid before June 30, 2024.
2. Tax liabilities under dispute, given the conditions of the amnesty are met.

Exclusions

• Penalties and interest imposed under Section 85 (tax avoidance) of the Tax Procedures Act, 2015, are not eligible.
• Penalties and interest on tax debts accrued after December 31, 2022, do not qualify for the amnesty.

Effective Date

The tax amnesty is effective from September 1, 2023, and remains in force until June 30, 2024.

Basis of Processing

The amnesty will be processed based on the tax period and tax obligation.

Covered Liabilities

The amnesty covers all tax heads under the Tax Procedures Act, 2015.

General Conditions for Remission

1. Interest and penalties related to principal tax due for periods up to December 31, 2022, are remitted upon full payment of the principal tax by June 30, 2024.
2. Taxpayers with liabilities for periods before December 31, 2022, must first resolve any issues with their respective Tax Service Offices (TSOs) and pay the outstanding principal taxes.
3. Taxpayers with disputes over liabilities must engage with the Commissioner to settle and agree on payment plans.

Application for Tax Amnesty

1. Qualified taxpayers must apply through the system.
2. The system will display the taxpayer’s debt status, allowing the selection of periods and tax heads that qualify for amnesty.
3. Taxpayers can either make full payment of the principal tax or enter a payment plan with the Commissioner.
4. Payment plans cannot extend beyond June 30, 2024. Any unpaid penalties and interest post this date will not qualify for amnesty.
5. Acceptance of the amnesty terms requires commitment to the payment plan.
6. Final amnesty is granted upon completion of the payment plan.

Treatment of Balance of Tax and Monthly Taxes

• Taxes due for the year ending December 31, 2022, must be paid by April 30, 2023, for interest and penalties to be eligible for amnesty.
• Monthly taxes for December 2022 are eligible for amnesty if deferred to the subsequent month’s specified due dates.

For comprehensive details and updates on the application process, taxpayers are advised to visit the KRA website​ (KRA Website)​​ (KRA Website)​.