Kenya Revenue Authority (KRA) is set to collect tax of Kshs. 79,285,945 following a decision by the Tax Appeals Tribunal in an Appeal filed by Standard Chartered Insurance Agency Limited.

KRA did an audit on Standard Chartered Insurance Agency Limited for the years 2015 to 2018 and raised an assessment for Kshs. 79,285,945 in respect of Corporation Tax, Withholding Tax and Excise Duty which was confirmed vide an objection decision on 4th October 2019.

Aggrieved by the decision of KRA, Standard Chartered Insurance Agency Limited filed an Appeal against KRA’s Objection Decision at the Tax Appeals Tribunal seeking to set aside the assessment stating that the same was unlawful.

KRA opposed the Appeal on grounds that Standard Chartered Insurance Agency Limited was accorded an opportunity to be heard but failed to provide documentation in support of their objection in line with the mandatory provisions of the Tax Procedures Act, the Excise Duty Act and Income Tax Act.

The Tax Appeals Tribunal delivered a judgment on 1st April 2021 wherein it ruled that the law required a taxpayer to maintain proper records to enable KRA adequately determine its tax lability and further obligated the taxpayer to produce the said records upon request.

Consequently, the Tax Appeals Tribunal ruled that Standard Chartered Insurance Agency Limited failed to discharge the burden of proof as required by law as no evidence was provided to disproof KRA’s tax assessments.

This is a win for KRA since it can now proceed to collect the outstanding taxes from Standard Chartered Insurance Agency Limited.

Further, KRA is set to apply the same decision to oppose similar Appeals from other taxpayers who do not submit the requisite documents in line with the provisions of the law.

Commissioner, Legal Services & Board Coordination-Mr Paul Matuku