Lecture 123 Β· An employer filed withholding tax on a casual supervisor as if he were a contractor, and billed him millions.
π»ππ πͺπππ πΉπππ: KRA billed a casual site supervisor KSh 5 million after his employer used his PIN to declare withholding tax as though he were a contractor. His objection was late and struck out, but the tribunal, finding the employer had admitted the error, ordered the taxman to hear the matter afresh on its merits.
Illustration: Precursor
You take a job and are still on probation, so there is no letter yet. The men you supervise have no bank accounts, so your employer pays their wages as a lump sum into your account and you hand out the cash. Later your employer deducts your own tax as an employee, but it has also been using your tax number to declare you a contractor, and the authority bills you millions.
Put yourself in the worker's chair. When your employer files withholding tax on you as a contractor, are you taxed as a business, or as the employee you are?
Continue reading
KES 49 for the rest of this piece.
About 693 more words, including the reasoning and what it means for operators. One payment, this piece, kept for good. No subscription and no renewal.
The Precursor Editorial Team
Precursor is published by the FinTech Association of Kenya and exercises independent editorial judgement under the Editorial Independence Charter. This article is labelled Precursor Executive Classroom, which marks commercial material. Knowledge on Tax and financial judgement.
Lecture 126 Β· A director kept meeting the taxman instead of appealing, and four years on the bill had only grown.
π»ππ πͺπππ πΉπππ: KRA confirmed a KSh 899,328 income-tax bill against Saphira, and its director spent four years in meetings and relied on his compliance certificates instead of appealing. The tribunal held meetings do not stop the thirty-day clock, a certificate is not proof of payment, and refused leave to appeal out of time; the debt had grown to KSh 1.4 million.
Tax and financial judgement Β· 4 min read Β· Paid
Lecture 125 Β· A rice importer called cleaning and repacking manufacturing, and the court said packaging is not making.
π»ππ πͺπππ πΉπππ: Mjengo claimed an investment deduction on KSh 1.5 million of machinery that cleaned and repackaged imported rice, calling it manufacturing. Through three forums the ruling held that packaging alone is not making goods, the rice remained rice, and a definition framed with 'means' is exhaustive. The deduction was refused.
Tax and financial judgement Β· 4 min read Β· Paid
Lecture 124 Β· A contractor said the money was his clients', had no agreements to show it, and the assessment stood.
π»ππ πͺπππ πΉπππ: KRA billed MU-BEI KSh 1.7 million after its eTIMS invoices far exceeded its declared sales. The company said the money was clients' funds for materials, passed on as an agent, but had no written agency agreements and no reconciliation. The tribunal held VAT fell due on the invoices and dismissed the appeal.
Tax and financial judgement Β· 4 min read Β· Paid