MPs to Meet Treasury, KRA Over the Sh3.2M Import Benchmark Row

On 2 September 2026, a Kenyan parliamentary delegation will sit with Treasury officials and senior Kenya Revenue Authority (KRA) representatives to examine the Sh3.2 million import‑benchmark row that has dominated recent tax‑compliance monitoring. The session will probe how the benchmark is calculated, its effect on importers, and possible legislative tweaks before the upcoming fiscal filing deadline. It follows parliamentary questions raised in June about the benchmark’s alignment with the Finance Act 2025.

For small‑ and medium‑sized enterprises, the outcome matters because the benchmark feeds into import‑related tax assessments and can shape cash‑flow planning. Companies that rely on imported raw materials have voiced heightened uncertainty, noting that the benchmark influences customs valuations. Observers are watching to see whether the Treasury will issue guidance that changes reporting thresholds or adjusts penalties linked to the import row.

What the compliance calendar is saying

The Kenyan tax calendar is anchored by a set of fixed monthly and quarterly deadlines that every registered business must meet:

• Monthly PAYE, NSSF, SHIF and the Affordable Housing Levy (AHL): payable by the 9th of the following month through iTax. Late deductions trigger the principal‑vs‑penalty regime and accrue interest.
• Monthly VAT: return due by the 20th of the following month, with the net tax payable on the same day. Valid tax invoices and a matching eTIMS record are required to claim input VAT.
• Withholding tax (WHT): agency remittance for management fees, professional fees, rent, dividends and interest, generally due by the 20th of the following month.
• Turnover Tax (TOT): applicable to businesses with annual turnover between KES 1 million and KES 25 million, taxed at 3 % of gross income, payable monthly or quarterly.
• Residential Rental Income Tax (RRIT): 7.5 % on gross rent for residential properties earning between KES 15 000 and KES 4 million per month, with advance tax payable each quarter.
• Corporate income tax: provisional instalment tax due on the 20th of the 4th, 6th, 9th and 12th months of the accounting year; final self‑assessment due on the 20th of the sixth month after year‑end for limited companies.

These dates represent the standard filing anchors; businesses should verify each window against the current iTax dashboard and any recent Finance Act amendments.

Compared with what is normal

The core schedule has remained stable for over a decade, with the 9th‑day PAYE deadline and the 20th‑day VAT deadline unchanged. Recent reforms have altered underlying rates and the electronic invoicing infrastructure. The NSSF contribution scale is now tiered, the SHIF rate stands at 2.75 % of gross pay, and the Affordable Housing Levy is split evenly between employee (1.5 %) and employer (1.5 %).

The eTIMS system now rejects paper‑only invoices for input‑VAT claims, forcing firms to adopt electronic tax invoices. The Finance Act 2025 also introduced a 0.5 % surcharge on imports that exceed the Sh3.2 million benchmark, tightening compliance further.

KRA has expanded its data‑matching capabilities, linking WHT submissions to bank and M‑Pesa transaction flows. When industry benchmarks such as the Sh3.2 million import row suggest under‑reporting, the system can pre‑populate assessments and raise audit flags. Consequently, any mismatch between a company’s books and the expected ratios raises the likelihood of a targeted audit.

Companies are advised to reconcile their import records with the benchmark before the next quarterly review to avoid surprise adjustments.

Tax Planning & Compliance — what this means for your books

Now for the business angle Beavoren cares about. A compliance shift is a leading indicator of penalty risk, input-VAT recoverability and cashflow timing — not just a filing date.

• Penalty and interest exposure. Late PAYE/VAT draws 25% penalty plus 1% per month compound interest; recognize a provision under IAS 37 the month a return is late rather than waiting for the demand.
• Input-VAT and eTIMS. Input-VAT claims now need a matched eTIMS invoice; an unrecorded supplier invoice is a recoverable-VAT loss, not a tax footnote — reconcile supplier eTIMS records to your purchase ledger monthly.
• Provisional instalment accuracy. Corporates pay in four instalments; underpaying instalment tax crystalises interest on the shortfall — re-estimate quarterly against actuals, not only at year-end.
• Payroll cost lines. NSSF, SHIF and AHL are employer cost lines that flow through payroll; keep them mapped to expense correctly so the management accounts match the iTax remittance.

Practical steps

• Pin the current year’s iTax filing calendar (9th/20th anchors) for every tax head you remit and set auto-reminders one week ahead.
• Reconcile supplier eTIMS records to your purchase ledger monthly so every input-VAT claim is defensible at the next KRA audit.
• Re-estimate provisional instalment tax each quarter against actual year-to-date profit, not only on last year’s figure.
• Recognize a late-filing penalty provision in the month a return is late rather than at year-end.
• Confirm NSSF tier, SHIF 2.75%, AHL 1.5% and any PAYE band change in your payroll software before the next run.
• Alert your accountant the week a Finance Act update drops, not the week a filing rejects.

Need help with compliance? Email info@beavorenventures.co.ke or call +254 716 296 857.

Disclaimer: This article is informational and does not constitute formal tax, audit or legal advice. For guidance specific to your circumstances, please contact Beavoren Ventures.