Digitalization and your tax

Digitalization has and will continue to revolutionalise tax administration in Kenya and across the globe. The more a society digitizes, the more exposure to tax assessments increases. Even without banking and use of MPESA and other mobile financial services, a person remains somehow exposed to the eyes of the taxman.

For instance, the lands registry in Kenya is undergoing digitalization. It means that in future it will be very easy for the taxman to trace land transactions that have been processed through the land registry. Even in absence of banking, a purchase of a land parcel is evidence that you have been making some money elsewhere. Such funds should be brought to charge if at all you hadn’t declared your income.

The fact that you recently acquired an SUV, is evidence that you are not badly off financially. Your nil tax return should be investigated.

As from 01/01/2024, it is a requirement that businesses should only claim business expenses that have been processed through e-tims(some expenses will be exempted). It is your B2B client who will force you to process sales through e-tims, lest you lose the business .

While tax evasion cannot be eliminated completely, It is also true that there is no foolproof method of tax evasion in a fast digitizing environment.

The earlier you arrange your affairs the better