You’re at your shop in Gikomba or your office in Westlands, the 20th is looming, and that familiar tax return panic starts to creep in. Do you log into iTax and brave it alone, or do you find that guy your cousin recommended?
The choice between DIY on KRA’s portal and hiring a tax consultant is a real dilemma for every Kenyan small business owner. This isn’t just about compliance; it’s about your time, money, and peace of mind. Let’s break down both options so you can decide what’s best for your hustle.
Going Solo: The iTax Route Explained
iTax is KRA’s online platform for all tax matters. It’s designed for you to handle filings yourself. Think of it as the DIY option—you buy the materials (your records) and do the construction.
The Real Benefits of Using iTax
The biggest win is cost. Filing on iTax is free. You only pay the tax you owe. For a bootstrapped startup in Nairobi or a fresh graduate’s side hustle in Kisumu, those saved consultant fees can mean a lot.
You also get direct control and instant updates. You submit, you get the receipt, you see your compliance status update immediately. No waiting for someone else to forward you an email. It builds your own understanding of your business finances, which is powerful.
The Challenges and Risks of DIY Tax Filing
But let’s be real. iTax can be a maze. The forms aren’t always intuitive, and KRA updates the system often. One wrong entry in your VAT 3 return or misclassification of an expense can trigger a query or even a penalty.
The biggest cost here is your time and mental energy. Time spent figuring out iTax is time not spent on customers or product development. And the stress of a KRA audit notice when you filed yourself? That’s next level.
Getting Help: Hiring a Tax Consultant in Kenya
A tax consultant is a licensed professional who handles your tax compliance for you. They’re your guide through the complex world of Kenyan tax law—from PAYE for your two employees to corporate tax for your limited company.
Why a Consultant Can Be a Lifesaver
Their value is in expertise and risk reduction. A good consultant knows all the legal deductions you’re missing. They ensure accuracy, which minimizes the risk of costly penalties from KRA. They handle the tedious work, freeing you up to run your business.
They also act as your shield. If a compliance issue arises, they communicate with KRA on your behalf. For many business owners, that buffer alone is worth the fee.
What to Watch Out For
Not all consultants are created equal. You must vet them. Are they registered with the Institute of Certified Public Accountants of Kenya (ICPAK)? Do they have good references?
You also surrender some control. You’re reliant on their timeline. And of course, there’s the ongoing cost, which eats into your monthly profits. You need to be sure the value they provide is greater than their fee.
Breaking Down the Cost: iTax vs. Consultant in KES
Let’s talk real Kenyan money, because this decision often comes down to the bottom line. Here’s a local price breakdown you can relate to.
iTax (DIY) Costs:
- Direct Cost: KES 0 for filing. You only pay the tax liability.
- Hidden Cost: Your time. Spending 5-10 hours quarterly figuring out filings. Could that time have generated KES 5,000-15,000 in sales?
- Risk Cost: A simple penalty for late filing can start at KES 10,000 or 5% of the tax due, whichever is higher. Errors can be more expensive.
Tax Consultant Costs:
- Monthly Retainer: For a typical small business (like a retail shop or small service firm), expect KES 3,000 to KES 10,000 per month.
- One-off Fees: Some charge per return (e.g., KES 2,000 per VAT return). Annual returns cost more.
- Value: A good consultant should save you more than they charge through optimized deductions and avoiding penalties. Ask them to demonstrate this.
The Verdict: Which Business Should Choose What?
So, which path is for you? It’s not one-size-fits-all. Your business stage and complexity decide.
When iTax is Your Best Bet
Choose iTax if your business is very simple. Think a sole proprietor with one income stream, like a freelance graphic designer or a small mitumba seller. Your transactions are few, and you’re comfortable with basic online systems.
This is also a good learning phase. Doing it yourself for a year gives you crucial knowledge, even if you hire help later. You’ll understand your numbers better.
When to Invest in a Tax Consultant
Hire a pro when things get more complex. Do you have employees (PAYE issues)? Are you registered for VAT? Is your turnover growing and your expense list getting long?
If the mere thought of tax gives you anxiety, or if you’re entering a growth phase, the consultant’s fee is an investment, not an expense. It protects you and lets you focus on scaling, maybe even opening that second branch in Thika Road or Kitengela.
Kenya-Specific Factors You Must Consider
This isn’t a theoretical debate. The Kenyan context changes everything. First, internet reliability. Trying to file on iTax on the 20th during a rainy season blackout in parts of Nairobi or Mombasa is a nightmare. A consultant files ahead of the rush.
Second, KRA’s aggressive automation. The iTax system is directly linked to your bank (via the Raid system), M-Pesa, and even motor vehicle records. Errors are caught faster than ever. A consultant helps you stay compliant in this automated environment.
Local Tip: Before hiring any consultant, ask for their PIN Certificate and check if they’re on ICPAK’s online register. Also, a good local consultant will know about specific county business permits (like from Nairobi City County) and how they interact with national taxes.
How to Get Started on Either Path
Ready to decide? Here’s your action plan.
If Choosing iTax:
- Ensure your KRA PIN is active and you have your iTax password. Forgotten it? Visit the Times Tower or a nearby KRA Huduma Centre with your ID.
- Watch the official KRA iTax tutorials on YouTube. They are actually quite helpful.
- Start simple. File your returns a few days before the deadline to avoid last-minute system crashes.
If Hiring a Consultant:
- Get recommendations from other business owners in your estate or business park.
- Interview at least two. Ask: “What’s your experience with a business like mine in [mention your industry]?”
- Start with a trial—maybe handle one quarterly return—before signing a long retainer.
Final Take: It’s About Your Business Health
There’s no universal “better” option. For a simple, low-turnover hustle, iTax empowers you and saves cash. For a growing business with more moving parts, a tax consultant is a strategic partner who saves you from costly mistakes and immense stress. Assess your business complexity, your own skill, and the value of your time.
Whichever path you choose, the goal is the same: stay compliant with KRA efficiently, so you can get back to what you do best—running your Kenyan business. Your next step? If you’re leaning towards a consultant, ask for a referral in your business network today. If you’re going DIY, block out two hours this week to log into iTax and just explore.
Got a tax horror story or success tip? Share it in the comments below—your experience could help another entrepreneur crack the code.