Many taxpayers assume that once their employer deducts PAYE they have fulfilled all tax obligations. However if you earn income from a side business consultancy rental property or farming you are required to declare these additional streams. Failing to do so can lead to non compliance and penalties.
The Kenya Revenue Authority iTax system allows individuals to consolidate all their income sources in a single annual return. Here is the professional process for declaring diverse income streams.
What Qualifies as Other Sources of Income In addition to your monthly salary taxable income includes consultancy or professional fees business profits from trade or services farming income and interest or dividends. It also includes rental income if it is not already being taxed under the Monthly Rental Income MRI regime.
Step by Step Guide to Filing Multiple Income Sources
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Prepare Your Records Before starting gather your P9 form for employment income. You will also need profit and loss statements for business activities and any withholding tax certificates for consultancy work. If you have rental income collect the records of gross rent received and expenses incurred.
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Access the iTax Portal Log in to the KRA iTax portal with your PIN and password. Navigate to the Returns menu and select File Return. Choose Income Tax Resident Individual as your tax obligation.
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Download the Correct Excel Form On the next screen select the tax period and download the Excel Income Tax Return form. Note that the simplified web based return is only for those with employment income only. For multiple sources of income you must use the Excel template.
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Enable Macros and Basic Information Open the Excel sheet and enable macros. In the Basic Information section select Yes for the question Do you have any income other than employment income. This action will automatically unlock additional sheets within the Excel document for business and professional income.
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Declare Income by Category Fill in your employment details in the relevant sheet as per your P9. Navigate to the newly opened sheets to enter your business income and expenses. If you have consultancy income ensure you capture the details from your withholding tax certificates in the section for tax credits. This ensures you are credited for the tax already paid by your clients.
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Validate and Submit Once all sections are complete proceed to the tax computation sheet. The system will aggregate your income from all sources and calculate the total tax due. After confirming the figures click Validate to generate a zipped file. Upload this file back to the iTax portal and download your acknowledgment receipt.
Key Compliance Reminders The deadline for filing individual income tax returns is 30th June of every year. If you have already paid withholding tax on consultancy fees remember that this is often not a final tax. You must declare the gross income and claim the tax withheld as a credit to avoid double taxation.
Get Expert Help Today Consolidating different income streams requires precision to ensure you maximize reliefs while staying compliant. FaidiHR provides professional assistance for complex tax filings and payroll management.
Contact FaidiHR for Professional Tax Support Call 254 702 339 699 Email sales@faidihr.com