It’s that time of the year again. You’re sitting with your phone or laptop, trying to navigate iTax, and the pressure is real. Maybe you’re rushing to beat the June 30th deadline, or you just got that reminder SMS from KRA. We’ve all been there.
Filing your taxes shouldn’t feel like a puzzle, but a simple slip can lead to penalties, withheld PIN certificates, or even a tax audit. This guide breaks down the 7 most common tax filing mistakes Kenyans make on iTax and gives you the straight-talk, practical steps to avoid them. Let’s get your filing right, save yourself the stress, and keep your records clean with KRA.
1. Filing Under the Wrong Tax Obligation
This is the granddaddy of iTax errors. Many people, especially those with side hustles or new businesses, file all their income under “Employment Income” only. But if you run a small business, freelance, or have rental income, that’s a separate obligation.
How to Avoid This Mistake
Log into iTax and go to the “Registration” tab. Click “Add Tax Obligation”. Here, you can add obligations like:
- Turnover Tax (TOT) for small businesses with less than KES 1M annual turnover.
- Residential Rental Income (if you earn over KES 144,000 annually from rent).
- Withholding Tax if you’re a contractor.
Declare each income stream under its correct obligation. Filing your M-Pesa hustle income under employment is a red flag for KRA’s system.
2. Incorrect or Missing Personal Details
You changed your phone number or moved from Buruburu to Kitengela, but you never updated your details on iTax. Big mistake. KRA communicates via SMS and email. If they send a demand note or verification request and you miss it, you’re liable for penalties.
How to Avoid This Mistake
Make it a habit to check your profile every filing season. Go to Profile > My Profile > View/Edit. Confirm your:
- Mobile number and email address.
- Physical and postal address.
This is also where you update your banking details for any refunds. A refund sitting at KRA because they can’t reach you is money wasted.
3. Messing Up the PAYE vs. Personal Relief Calculation
This confusion causes many to either overpay or underpay. Your employer deducts Pay As You Earn (PAYE) monthly. When filing your annual return, you must account for the total PAYE deducted AND claim your Personal Relief (currently KES 2,400 per month).
How to Avoid This Mistake
Get your P9 form from your employer (or download the ATS from iTax). The total tax charged (PAYE) for the year is on it. On iTax, when filling the return, you will enter your gross salary, allowable deductions, and the total tax paid (PAYE). The system automatically applies your personal relief (KES 28,800 annually). Don’t manually subtract it from your PAYE total—you’ll double-count it.
4. Ignoring or Misunderstanding Allowable Deductions
You’re leaving money on the table! Many Kenyans pay more tax than necessary because they don’t claim all allowable deductions. These are expenses you incurred to earn your income that you can subtract from your taxable pay.
How to Avoid This Mistake
Gather your receipts and claim for:
- NHIF, NSSF, & HOSPITAL INSURANCE: Full amounts paid.
- Owner Occupier Interest: Interest on your mortgage if it’s your home (up to KES 300,000/yr).
- Retirement Contribution: To registered schemes (up to KES 20,000/month).
- Other Deductions: Like HELB loan repayment.
Have the supporting documents ready in case KRA asks. This can significantly reduce your tax payable or boost your refund.
5. The Deadline Dash & System Crash Panic
Everyone waits until the last week of June. The result? iTax servers slow down or crash, the queue at Times Tower is insane, and you make rushed errors. Filing under pressure is a recipe for the common tax filing mistakes we’re trying to avoid.
How to Avoid This Mistake
Don’t wait for the long rains to end to start thinking about your roof. Start your filing in April or early May. This gives you ample time to:
- Gather all your documents (P9, receipts, bank statements).
- Seek help if stuck (consult a tax agent, use the KRA help desk).
- File calmly and review your return.
Beat the mad rush and file accurately.
6. Not Declaring All Income Streams (The “Side Hustle” Blind Spot)
You have a salary, but you also sell mitumba online, do graphic design gigs, or rent out a room in your house. Thinking KRA won’t know? With the new KRA Digital Service Tax (DST) and integration with platforms, it’s riskier than ever. This is a major Kenyan-specific pitfall in our gig economy.
How to Avoid This Mistake
Be proactive. Declare all income. For your side hustle:
- If annual turnover is below KES 1M, register for and file Turnover Tax (TOT) at 1% of gross sales. It’s simple and cheap.
- For rental income, use the Residential Rental Income obligation. The first KES 144,000 per year is tax-free.
Full disclosure is always safer and cheaper than penalties and back taxes.
7. Failing to Download and Keep Your Documents
You hit submit, see the “success” message, and close the browser. Done, right? Wrong. You must download and save your iTax documents. If KRA queries you in 3 years, you need proof of what you filed.
How to Avoid This Mistake
Immediately after filing:
- Download the iTax Return PDF (it’s your proof of submission).
- Download the Payment Slip/Assessment (shows if you owe tax or are due a refund).
- If you pay, download the Payment Receipt from your bank or M-Pesa statement.
Save these PDFs in a dedicated folder on your phone or cloud. Name them clearly, e.g., “ITR_2024_JohnDoe”. This is your audit armour.
Kenyan-Specific iTax Hacks: Beat the System & Save Your Coin
Let’s talk real local context. Filing taxes in Kenya isn’t just about the forms; it’s about navigating the environment. Here’s what you need to know beyond the iTax portal.
First, use the right help channels. Going to Times Tower in Nairobi should be your last resort. Instead, use the official KRA USSD code *572# for basic services. For complex issues, call the KRA Contact Centre (020 499 9999 or 0711 099 999) early in the morning when lines are less busy. Follow up via their official Twitter (@KRACare) for public queries.
Second, understand the penalties in real terms. Getting it wrong isn’t just a “sorry.” If you file your return late, it’s a penalty of KES 2,000 plus 5% of the tax due. If you under-declare, the penalty is 10% of the undeclared tax. For a small business owner in Gikomba or a freelancer in Kisumu, that’s a huge, unnecessary hit that could have been a new device or stock.
Finally, a pro tip: If you need in-person help, consider visiting a smaller KRA station like those in county headquarters during mid-month. They are often less crowded than the main hubs in Nairobi, Mombasa, or Nakuru. The staff there might have more time to walk you through a tricky part of the form.
Wrap Up and Get It Done
Avoiding these 7 common tax filing mistakes on iTax is about being informed, prepared, and proactive. Remember to file under the correct obligations, update your details, claim all your deductions, and declare every shilling from your side hustle. Most importantly, don’t wait for the last-minute June rush. Start the process now, gather your documents, and file with a clear head.
Taking control of your tax filing saves you money, stress, and keeps you compliant with KRA. It’s a key part of adulting in Kenya. Got your iTax password ready? Log in today and make a start. And if you found this useful, share it with your WhatsApp group or your colleague at the co-working space—help someone else avoid the headache.