New Relief for Taxpayers

The Kenya Revenue Authority (KRA) has rolled out an Automated Payment Plan (APP), a new system designed to ease the financial strain on individuals and businesses with outstanding tax liabilities. According to a report by People Daily on Friday, November 8, 2025, the initiative, which reportedly became effective on November 7, 2025, allows eligible taxpayers to settle their principal tax, penalties, and interest through structured monthly instalments over a maximum period of six months. This development aims to enhance voluntary tax compliance by providing a more manageable debt settlement solution.

The APP mechanism is accessible through the KRA's iTax portal, where taxpayers can submit their payment proposals for system validation. The primary goal of this automated system is to offer a formal and structured path for taxpayers to manage and clear their arrears without jeopardizing their financial stability. Official confirmation and detailed guidelines from the KRA on its website were not available at the time of this report, indicating that further clarification from the authority is required.

Eligibility and Compliance Conditions

To qualify for the new Automated Payment Plan, taxpayers must meet several stringent conditions as outlined in the initial report. According to People Daily, the key requirements include:

• A valid KRA Personal Identification Number (PIN).
• Full compliance with all iTax profile requirements.
• Confirmed tax liabilities within the KRA system.
• The outstanding debt must not be under active dispute, such as an objection, appeal, or litigation.
• The taxpayer must demonstrate a genuine inability to clear the liability in a single lump-sum payment.

The KRA has emphasized the importance of adhering strictly to the agreed payment schedule. The notice reported by People Daily warns that any failure to meet the instalment deadlines could lead to the termination of the plan. Should a taxpayer default, the KRA may reinstate enforcement actions, including the revocation of their Tax Compliance Certificate (TCC) and initiating other legal recovery measures to collect the outstanding amount.

Context: APP vs. Tax Amnesty Program

The introduction of the APP runs alongside the KRA's ongoing Tax Amnesty program, which was extended by the Tax Procedures (Amendment) Act, 2024. It is crucial for taxpayers to distinguish between the two initiatives. The tax amnesty specifically targets debts accrued up to December 31, 2023, and allows for the waiver of penalties and interest if the principal tax is fully paid by June 30, 2025. Taxpayers with outstanding principal debt under the amnesty must apply and propose a payment plan.

In contrast, the new Automated Payment Plan appears to be a separate mechanism. While details are still emerging, the APP seems to offer a shorter, more structured instalment plan (up to six months) for a broader range of undisputed tax liabilities, not limited to the pre-2024 period covered by the amnesty. This suggests a strategic move by the KRA to provide multiple avenues for debt resolution, targeting different categories of tax arrears.

Implications for Kenyan Taxpayers and the Economy

The rollout of the APP signifies a continued shift in the KRA's strategy towards enhancing compliance through facilitation rather than solely relying on enforcement. For individuals and small and medium-sized enterprises (SMEs) facing cash-flow challenges, this plan offers vital breathing room to regularize their tax affairs without facing immediate and disruptive recovery actions. By automating the application and validation process on iTax, the KRA aims to improve efficiency and reduce the administrative burden for taxpayers seeking relief.

This initiative is part of a broader push by the authority to leverage technology to expand the tax base and meet ambitious revenue targets. In recent months, the KRA has also announced plans to validate income and expenses in tax returns against eTIMS data starting in 2026 and has explored AI-driven algorithms for tax collection. The success of the APP will depend on its accessibility, the clarity of its terms, and its integration within the existing iTax framework. Taxpayers seeking to utilize the plan are advised to visit the KRA's official online platforms or contact the authority through its official support channels for guidance.