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Home 2014 March Howto do withholding tax on iTax

Howto do withholding tax on iTax

The new KRA iTax system has come with its challenges but it has greatly improved some of the taxpayer obligations that we have to undergo every month.

One such procedure is how to do your Withholding tax reporting and how to make the payment. Refer to this post and see how it used to be done manually then you will surely appreciate how iTax is handling it now.

Checklist

Below are some of the things you need to have done so that you can be able successfully do your Withholding tax reporting on iTax;

  1. Updated your tax payer obligations on ITMS to include Withholding tax
  2. Registered your company on iTax (refer to post)
  3. The tax PIN of Withholdee
  4. 5 minutes in preparation time and 10-30 minutes queuing time

Motivation

The payer (Agent) of the income mentioned is responsible for deducting and remitting the tax to the Commissioner on or before the 20th of the month following the period of deduction.

The consequences of Non – compliance by the Agent :-

(i) Tax which should have been recovered from the income of the payee, will be recovered from the income of the payer (Agent).

(ii) Any penalties and interest incurred on the above will now be borne by the Agent.

In other words, if you don’t withhold tax from your suppliers and remit it to KRA, then you risk having to pay their tax should they “forget” to declare everything themselves.

Procedure

On the KRA website, click on the huge iTax banner that will redirect you to the iTax login page. Using your company PIN Number and password, log into the system.

Proceed to the “Payments” tab then select “Payment registration” – Note: Withholding tax does not exist as a ‘Return’ and you will not find it by clicking on the “Returns” tab.

The logic here is that withholding tax is tax that you are paying on their behalf of someone else, not your own that you have to file – hence you go directly to payment.

Withholding_Tax_Payment_Registration

The system will then show you the “e-Payment registration form” with your company details already filled out. Proceed to fill out the “Tax Head” where you will click the drop down menu and select “Income Tax”. It is an income tax as you as the company are reporting someone else’s tax on their income.

The “Tax Sub Head” should then be “(0105) Income Tax – Withholding”.

Withholding_tax_options

There are two options for doing a Withholding tax return:

1. You can choose to submit “By Using Excel Upload”. This option is preferable especially if you are submitting the returns of more than one consultant as it allows you to do it simultaneously as opposed to filling out many independent web forms, one at a time.

2. You can also choose to submit “By Web Form”.

The “Excel Upload” option directs you to download an excel sheet. After downloading it, proceed to fill the payment excel sheet, save and validate it and then upload it onto iTax using the browse button given.

Withholding_tax_excel

If you choose the “Web Form” proceed to the next section where you need to select the “Nature of Transaction” from the drop down menu. All the available transactions have a different tax percentage so you need to be sure which one your supplier belongs to.

(For the purpose of this example, we are going to use a Consultant earning above 24,000KES/Month.)

Proceed to fill out the Withholdee’s PIN number and the system will fill out the rest of the details for you, ie, their full names, address and email.

Finally fill out the “Gross Amount” that you are paying them and again, the system does the rest for you.

Withholding_Nature_of_Transaction

Click the “Add” button so that that transaction is added to the list of transactions that you have/ want to have. You can continue adding new transaction lines if you have more than one supplier you are withholding for and are preparing their report.

Finally proceed to select “Mode of Payment” and the “Receiving Bank Name”, which is the bank where you will make your payment (here, we would suggest to select the smaller banks with shorter lines so as to save yourself some queuing time).

Withholding_Receiving_Bank

Click submit and you are more or less done!!

The system will submit your withholding details for that month and give you back a ‘download link’ where you can download your withholding tax “Payment Slip”. A copy is sent to your email address and your supplier also automatically receives their Withholding tax certificate.

You should then print the payment slip in 2 copies and take to the bank you selected to make your payment.

Withholding_Payment_Slip

Highlights

Before iTaxWith iTax
30 minutes in preparation time and at least 3 hours in queuing time.5 minutes in preparation time and 10-30 minutes queuing time
Preparing a withholding tax certificate to the supplierCertificate automatically sent to the supplier.

My two cents: Everyone should simply try using iTax for their returns as it cannot get any easier than that!! Kudos to KRA on this one…

Mar 14, 2014Angela Nzioki
Image5 years ago 95 Comments Compliancy, Goverment officesiTax, KRA, KRA returns, Withholding, Withholding tax0
Angela Nzioki

I love books, I'm a wannabe professional writer, I love technology and all it has to offer, I want to travel and see the world, I love golf, I love drama, I love mentoring women in technology, I see the challenges we face as Africans and I want to find solutions for them, I love people.
Co-founder of Pluspeople Kenya (aka Uhasibu).

Company registration on KRA's iTaxMissing previous submissions on iTax...??
Comments: 95
  1. Nicodemus
    1 year ago

    This is truly informative. Good job!
    Thanks.

    ReplyCancel
  2. Mustafa Feisal
    1 year ago

    Hi Angela.
    i usually deduct 6% when paying suppliers and pay instantly to KRA. what happens if i forget to deduct the withholding tax and pay full amount?

    ReplyCancel
  3. ESTHER
    1 year ago

    WHEN IS THE WHT DUE FOR PAYMENTS AFTER DEDUCTING FROM THE SUPPLIER.

    ReplyCancel
  4. James
    1 year ago

    Generated Etr receipt but the witholding tax cert was issued to a different pin holder.How do I correct this?

    ReplyCancel
  5. Hetal
    2 years ago

    How do I pay WHT for a foreign worker who is on a special pass awaiting his permit and PIN?

    ReplyCancel
  6. Charles Masai
    2 years ago

    Hi Angela,
    I am having trouble filling annual returns with withholding certificates for someone who works with an insurance firm. Kindly advice, how do I go about it?
    Thanks.

    ReplyCancel
  7. moses
    2 years ago

    how do i declare withholding tax before submitting the returns?

    ReplyCancel
  8. moses
    2 years ago

    how do i declare the withholding tax because when i submit my return it tells me that an withholding have been issued i need to declare the same

    ReplyCancel
  9. LW
    2 years ago

    Is the withholdee supposed to pay 25% or is declaring the tax enough?

    ReplyCancel
  10. Elvis Mbeya Njenga
    2 years ago

    Thanks So much

    ReplyCancel
  11. Peter
    2 years ago

    Hi, I am Peter and am trying to submit a withholding tax of 5,000. From the above illustration, the company has to declare but how do I declare the withholding tax? I tried the web option and even gotten the certificate but when I try to do my normal returns I am told to declare the withholding tax again. What do I do????

    ReplyCancel
  12. JONATHAN LIWINDI
    2 years ago

    i am doing my KRA INDIVIDUAL returns,after filling the excel spreadsheet and submitted i am being told to declare withholding tax. how do i do this

    ReplyCancel
  13. Douglas
    2 years ago

    Hi, personally I pay PAYE, But recently I received a notification from KRA about my SACCO some amount has been withheld by the SACCO and submitted to KRA Nairobi.

    Now when I try to do PAYE returns, I receive the following message;
    "Withholding Certificate Number KRAWHTNON3360222016 has been issued for the taxpayer. Please declare the same."

    ReplyCancel
  14. Okabinin Okundupe Esamuriat
    2 years ago

    hello, i have a question, from what amount is someone supposed to be charged withholding tax on labor, and if so can someone be charged withholding tax if its not on contractual service?

    ReplyCancel
  15. Teddy Baya
    2 years ago

    What has been discussed is WHT being made by a company.
    Please include discussion where an individual has to include WHT in his normal returns in cases where he/she was payed for consultation and Tax withheld

    ReplyCancel
  16. Charles
    2 years ago

    Hi,
    How do I classify withholding tax on dividends paid to a kenyan resident on the uploadable excel sheet? Is it Qualifying dividends or Ordinary dividends?

    ReplyCancel
  17. steve
    2 years ago

    how do you file a credit note no itax while filing w/vat??

    ReplyCancel
  18. Jacob Amwayi
    2 years ago

    Hello,
    How do you file WHT for a non-resident on itax?

    ReplyCancel
  19. Will
    3 years ago

    Hello, I am a consultant not based nor from Kenya. I am charged 20% with holding tax. Do I get a tax refund and can I put in a tax return?

    Thank you

    ReplyCancel
  20. Charlo
    3 years ago

    Hi Angela,
    I i received a withholding certificate with 5% of the total transaction withheld. Do in now need to declare or file any further taxes in relation to this transaction? (more specifically, do i need to file 11% to make it 16%?). Thanks

    ReplyCancel
  21. John
    3 years ago

    Great article here. I would like to see info, if my client charges the 5% WHT, should I also pay VAT on this same amount? So e.g. I charge the client 100k, they remit 5% WHT. When doing my VAT returns should I base on the 95k, 100k?

    Thanks

    ReplyCancel
  22. kwakha
    3 years ago

    How does one reverse a WHT certificate generated wrongly? like i did do a submission on company that invoiced us i input the invoice and ended up with apayment slip and aknowledment transaction from KRA? which i would like to cancell?

    ReplyCancel
  23. Eunice
    3 years ago

    Hello, what percent do consulting firms pay as tax?

    ReplyCancel
  24. Nicholas
    3 years ago

    How do u generate another payment slip when it expires?

    ReplyCancel
  25. philip
    3 years ago

    Hi, while withholding 6% vat, on transactions that attract extra discounts like rebate and prompt payment or cash discounts that are issues in form of credit note. At what point or value should we withhold the 6 %? Gross value (invoice value) or net value after deducting the extra discounts

    ReplyCancel
  26. Mariga James
    3 years ago

    Hi, am trying to file my returns using my withholding certificate but am not able. kindly advice

    ReplyCancel
  27. Kennedy
    3 years ago

    Hi, I have completed my filing of returns but have an error of not including WHT component of pension recieved in the year. I had a employment income in 2015 and liquidated pension. How do we go about this on itax

    ReplyCancel
  28. Peris
    3 years ago

    Very informative. Thanks.
    As the consultant, how do file the returns on the withholding tax that was paid by the employer?

    ReplyCancel
  29. Esmail
    3 years ago

    Hi, I'm a withholdee and would like to submit my annual return. How do i go about in iTax?

    ReplyCancel
  30. Muthui
    3 years ago

    Hi Angela/Linda,

    Thanks for this ingenious idea, very informative website. I have a contraction business and employ workers as work becomes available, would I be right in using withholding tax scheme when paying them? Also is the amount I deduct and pay to KRA final in the sense that KRA will not the ask workers for more tax? Thanks.

    Muthui

    ReplyCancel
    • Muthui
      3 years ago

      Sorry I meant ''construction business''

      ReplyCancel
  31. Ivan
    3 years ago

    As a withholdee when i try to submit my returns i get an error: "Withholding Certificate Number ...................... has been issued for the taxpayer. Please declare the same." How do i do this?

    ReplyCancel
  32. Nderitu Anthony
    3 years ago

    For those that bank with Saccos' FOSA accounts, how do they give their bank details while Saccos are not in the drop down list?

    ReplyCancel
  33. James Mwangi
    3 years ago

    WHT on doctors locum is at 5% of the gross amount. Does the threshhold of the amounts above 24k prevail in this circumstance or you can do even for a lesser amount say kes 10000

    ReplyCancel
  34. betty
    3 years ago

    simple and clear

    ReplyCancel
  35. betty
    3 years ago

    very informative post , keep it

    ReplyCancel
  36. Docky
    3 years ago

    Hi Angela,

    I have two questions;

    1. If i need to withhold tax for legal fees that has been invoiced in USD, do i need to request from the supplier an invoice in KES?
    2. If not, what rate do I use for conversion CBA ex rates or KRA ex rates, and if KRA; buying or selling rates.

    Thank you

    ReplyCancel
  37. Mustafa Abdulhussein
    3 years ago

    Hi!I did my witholding on itax today but due to internet connection faliure it failed to generate a payment slip.When I try to redo the process I get the message"Payment has already been made for the above data.Please select it from partial payments".I have tried to look for the partial payments tab but cannot seem to find it.Please can you help me.Thanks

    ReplyCancel
    • Angela Nzioki
      3 years ago

      Mustafa, there is not partial payments tab. It is just the normal payments tab and you can find out where the registered payments are by following the registering payments section of the post.

      ReplyCancel
      • Eric
        3 years ago

        Hi Angela, I seem to have the problem with Mustafa, is there a place you can point us to so that we can retrieve the partial payments?

        ReplyCancel
  38. Aaron Muiru
    3 years ago

    Hi Angela,
    First off, I really appreciate the info you have put together here. I've found it immensely useful. Now just one question, would a management consultant be required to pay PAYE after withholding tax has been deducted and remitted? Kindly let me know.

    ReplyCancel
    • Angela Nzioki
      3 years ago

      Aaron, no. You either pay Withholding Tax or PAYE. Workers are divided in two; consultants - who pay wittholding tax or full time employees - who pay PAYE.

      ReplyCancel
      • Terry
        3 years ago

        Hi Angela,
        Thank you for this very informative article. My only source of revenue in 2015 was as a part time consultant and my clients submitted the withholding tax to KRA. In my Itax returns, should I then file nil returns because I am not the tax payer (that is the entity that remitted the tax)? I have attempted to fill in the excel sheet but it's calculating my tax at 12.4%, and not the 5% that was withheld, consequently showing that I owe KRA.

        ReplyCancel
        • Reba
          3 years ago

          Hi Terry did you find a solution to your problem as I am facing the same predicament and i do not know how to proceed as KRA are not answering their phones or even responding on social media

          ReplyCancel
        • Linner
          3 years ago

          Hi Angrla,

          Thank you so much - very informative. I have the same problem as Terry ( above). Please advise on whether as a consultant we file nil-returns as Terry asked?

          Thanks again.
          Linner

          ReplyCancel
        • JACOB MUTHOKA
          2 years ago

          HI ANGELA,
          Kindly reply to this I am also having the same problem

          ReplyCancel
      • Aaron Muiru
        3 years ago

        Thanks so much Angela, much appreciated.

        ReplyCancel
      • david laisa
        2 years ago

        Please Angela i have gotten this message when filling my tax Withholding Certificate Number KRAWHTWON2503042016 has been issued for the taxpayer. Please declare the same.

        please help

        ReplyCancel
  39. Martha Kilakoi Tompoya
    3 years ago

    What percentage should be withheld for contractors?
    For doing renovations or constructions

    ReplyCancel
    • Angela Nzioki
      3 years ago

      Contractors earning above 24,000KES you should withhold 5%.

      ReplyCancel
      • Muthoni
        3 years ago

        How do i file returns? i only have the withholding certificates and i tried the normal one and the error said " please declare you have the withholding certificate" i can even see the tab for tha

        ReplyCancel
      • Felix
        2 years ago

        What of 30% corporate tax? So if u withhlod 5% should the payee declare the remaining 25% or 30%? Hii mambo ya tax ni ngumu kweli.

        ReplyCancel
  40. Andrew
    3 years ago

    Thank you for the information very helpful. Some 2 questions, 1. How do I make amendments after i have generated a payment slip but but before submitting money to the bank.
    2. If already paid the WHVAT how can i cancel a certificate?

    ReplyCancel
    • Angela Nzioki
      3 years ago

      Andrew, unfortunately we have not had that issue ourselves so we don't have any experience to share on this matter - you should consult KRA or a tax-expert.

      ReplyCancel
  41. Alfred
    3 years ago

    Hi Linda Kariuki,
    The company I recently joined has been filing nil returns, but it was not until when one amongst the many of her clients held 5% of the contract amount. Now filing nil returns online no longer works, itax requires the company to claim the withheld amount by filing the returns.
    Also, sum-total of 16% VAT as per our invoices is 367,765, it sounds queer to tell the employer that we are filing to this tune! Is there anything I can do to reduce this? Given that we only have input tax of hardly 5k.
    However, the company has been using "artificial etr's", making it hard to claim....I am stranded and apparently I might not be able to file by 20th.
    Kindly advice.

    ReplyCancel
    • Angela Nzioki
      3 years ago

      Alfred, unfortunately we have not had that issue ourselves so we don't have any experience to share on this matter - you should consult KRA or a tax-expert. My apologies.

      ReplyCancel
  42. Kaye
    3 years ago

    How do you generate a new e-slip for WHT after the valid date has expired? When I try to register with the same details the dialogue box that comes up says to go to 'partial registration'. How do we do this? Please HELP!

    ReplyCancel
    • Angela Nzioki
      3 years ago

      Kaye, we only share things we have had an issue with. We have never had that problem so I wouldn't know what to do either. In most cases, I would call KRA and ask them to assist me which is probably what you should do.

      ReplyCancel
  43. PETER MWANGI
    3 years ago

    How do I re-generate a new eslip for WHT after the valid date has expired?

    ReplyCancel
    • Angela Nzioki
      3 years ago

      Not exactly sure but try the "Reprint Withholding Certificate" link on iTax under the "Certificates" tab.

      ReplyCancel
      • OENGA
        3 years ago

        You are recommended to redo the payment so that the system can generate a new PRN

        ReplyCancel
      • OENGA
        3 years ago

        By reprinting WTH cert you just generally creating another WTH cert, follow steps I have given below for the case of expired PRN (Eslip)

        ReplyCancel
      • OENGA
        3 years ago

        *steps above

        ReplyCancel
  44. MUGUNYI
    3 years ago

    I WITHHELD 15% ON CONSULTANCY FEE.WHEN FILLING THE SYSTEM INPUT 5% HOW DO I GO ABOUT IT

    ReplyCancel
    • Angela Nzioki
      3 years ago

      Return the 10% you took from the consultant to the consultant? Withholding tax for professional services in Kenya is 5% not 15%

      ReplyCancel
  45. Edward
    4 years ago

    Hi,

    No one seems to know when and how the balance of 25% of the tax is paid by the withholdee. Anyone have an idea? Is the tax filed monthly by the 20th or the next months, quarterly or yearly?

    ReplyCancel
  46. LINDA
    4 years ago

    Hi, I have tried to submit my VAT but gets jammed with the following message
    Withholding Certificate Number ..... has not been issued to the tax payer for the provided return period. AND
    Please declare the withholding certificate Number ......
    I am new to the Itax and does not know how to go about doing the above.
    Can someone please assist me. How do I do this.
    Thank you.
    Kind regards

    ReplyCancel
  47. Geoffrey
    4 years ago

    Filing on itax is hell on earth

    ReplyCancel
  48. Geoffrey
    4 years ago

    Hi,

    Explain the steps for generating a PRN for custom duty payments.

    ReplyCancel
  49. Kutty
    4 years ago

    Hi, how do l generate a new e slip when the current one has expired?

    ReplyCancel
  50. Kutty
    4 years ago

    Hi, how do l apply for a new e slip when the current one has expired?

    ReplyCancel
  51. ANKUR
    4 years ago

    VERY GOOD SITE.
    INFORMATIVE AND ALL THE PROCEDURES ARE THEIR TO GUIDE US.
    GOOD WORK,, BRAVO...
    KEEP UP THE GOOD WORK

    ReplyCancel
  52. gray
    4 years ago

    hi. so what about the withholdee? how does one declare thw withholding tax on itax

    ReplyCancel
    • Linda Kariuki
      4 years ago

      Hi Gray, I would think you would declare the withholding tax when filing for your individual income tax at the end of the year. However I would advise you to confirm will the KRA before you proceed.

      ReplyCancel
  53. Judy
    4 years ago

    Hi
    Thanks for keep us updated on how to use itax. As a part time consultant how do i file my returns on itax as to reflect withholding tax deducted by my employer? I have a slip from my employer showing withholding tax was paid but cannot figure out where to enter this on the excel spreadsheet.

    ReplyCancel
  54. Patrick
    4 years ago

    how does one include it in filing returns?

    ReplyCancel
  55. simon
    4 years ago

    PLEASE ADVICE,
    should i pay 10% VAT to the KRA instead of 16% when the purchaser has withheld 6% WHVAT?

    ReplyCancel
    • Kevin
      3 years ago

      I was told you pay first the 16% then request for refund. Is that true?

      ReplyCancel
    • Felix
      2 years ago

      Yes. Absolutely!

      ReplyCancel
  56. Wambui
    4 years ago

    Is there a way to void a withholding tax filing if done with the wrong amount?

    ReplyCancel
    • Angela Nzioki
      4 years ago

      I don't think so. We did the same mistake once to correct it, we asked our supplier to give us an invoice of the "wrong" amount we had registered then added the difference on the next invoice from the supplier.

      ReplyCancel
  57. roktok
    4 years ago

    have clicked on the submit button and the result states 'payment registration has already made for some of the uploaded data. please use normal web form for already registered payments". have checked on the consult payment button and their is no trace of such payment,,,, what happens in such a case...please help.(.withholding tax_)

    ReplyCancel
    • Angela Nzioki
      4 years ago

      We wouldn't know. We've never experienced that. Kindly get in touch with KRA, they should be able to assist you.

      ReplyCancel
  58. jay
    4 years ago

    when going to the bank with the payment slip, whom should the cheque be addressed to?

    ReplyCancel
    • Linda Kariuki
      4 years ago

      Hi Jay,
      I would advise you to consult with your bank first. Some banks i.e CFC Stanbic bank advises one to address the cheque to the bank itself.

      ReplyCancel
  59. Norman Ngila
    5 years ago

    Bravo KRA ICT Dept,you have really relieved us alot,keep it up

    ReplyCancel
    • Linda Kariuki
      5 years ago

      Dear Norman,

      First we would like to make it clear that we are not KRA ICT department, we are not employees of KRA nor do we have any affiliation to KRA. We are independent business owners running our own business and sharing our experiences in interacting with various government bodies, with other business people in the form of this blog.
      However, we are grateful for the feedback and hope you will continue reading and recommending this blog to others.

      ReplyCancel
  60. azhar
    5 years ago

    how do we get the withholding certificate after payment is done..kindly please sort me out would appreciate it..
    thanx

    ReplyCancel
    • Angela Nzioki
      5 years ago

      Hi Azhar, the withholding tax certificate is normally sent to the witholdee directly as it belongs to them. Confirm with your witholdee if they received it and ask them to send you a copy if you need it too.

      ReplyCancel
      • Dennis
        2 years ago

        halo Angela
        in my case i have the certificate number but i don't know where to put on the excel sheet . am using a p9 form. kindly help

        ReplyCancel
      • Faith Wanga
        2 years ago

        Hi. So the withholdee will do the filing for me?

        ReplyCancel
  61. David Gatuna
    5 years ago

    It is a good thing to have new systems but it is another to make it work efficiently. One major fault with the Itax system and especially when filing WHT is data entry. To start with we may not all be having the PIN numbers for our suppliers and secondly the data capturing method. Why not simply upload a Csv file? I process WHT for over 100 vendors every month,it would ridiculously take me more time to make my filing than queuing. KRA should make systems that work and not rush implementing a bottleneck!!!

    ReplyCancel
    • Angela Nzioki
      5 years ago

      Hi David,
      I hope you have noticed on the data capturing method the new improved system where you can fill the excel sheet independently and update it like you had suggested. Usually you cant do WHT without the pin numbers of all your suppliers so make sure you always do before you start. Everything should be easier for you now.
      Best Regards.

      ReplyCancel
  62. moneyacademy.co.ke
    5 years ago

    Very informative post there. Uncomplicating the complicated. I will quote this soon on my blog.

    ReplyCancel
    • Linda Kariuki
      5 years ago

      Hi Money academy, Thanks for your feedback. Keep reading for more.

      ReplyCancel

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