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In the Tax Procedures Act (2015), there are various terms used that relate to the application of tax procedures in Kenya. This post is about the interpretation of some of those posts.

Licensed person

A licensed person in the Tax Procedures Act (TPA) is a person who is licensed or registered under any tax law in Kenya such as Income tax law, Value Added Tax law, Excise duty law etc.

Tax agent

A tax agent means a person who is licensed by KRA as a tax agent to perform various acts for a taxpayer such as preparation of tax returns, lodging notices of objections, representing taxpayers in KRA etc. Only natural persons are licensed as tax agents by KRA.

Limited partnership

A partnership is when two or more persons for an organisation for purposes of business with the risks borne equally. However, a limited partnership the risks are restricted to each person’s participation in such areas as time spent in the organisation, capital contribution etc. However, according to the TPA, a limited partnership means a limited partnership registered under the Limited Liability Partnership Act, 2011 in Kenya or a foreign limited partnership within the meaning of the Partnership Act, 2012 in Kenya.

Objection decision

Taxpayers lodge notices of objections on Commissioner’s decisions for example assessment decisions. An objection decision is the decision that the Commissioner makes on receipt of notice of objection by a taxpayer. The notice of objection from the taxpayer must be validly lodged according to Section 51(8) in the TPA.

Official language

For TPA purposes, the official tax languages Kenya are either Kiswahili or English. This means that tax records/ documents and communication regarding tax issues can be held in either Kiswahili or English.

Penalty

This term means any penalty imposed under any tax law in Kenya such as under Income tax law, Value Added Tax law, Excise duty law etc.

Person

A person can be a natural person or a legal person. According to the TPA, this term has a broad meaning referring to:

• Individuals.
• Companies.
• Partnerships.
• Association of persons.
• Trusts.
• Estates.
• Governments.
• A foreign government.
• Political subdivisions of a government.
• Political subdivisions of a foreign government.

It is important to note that tax laws such as the VAT Act have specifications on who a person is.

Personal identification number

Personal identification number is commonly referred to as PIN. It is the tax number issued under Section 12 of the TPA to every person who is required to abide by tax laws in Kenya. Currently, a person cannot be issued with a PIN unless they have reached the age of acquiring a national identification card. In Kenya, one is issued with a national identification card once they attain the age of eighteen (18) years.

Political subdivision

Political subdivisions are government divisions that are lower than the national government. Currently, we have Country governments as the lower government subdivision. The term also means provincial, local, state etc. which are not currently in operation in Kenya.

Prescribed form

This is any form that the Commissioner expects the taxpayer to lodge when required to be submitted for tax purposes under any tax law in Kenya. The form is lodged as a tax return, an application, a notice statement or any other document. The prescribed form may be a hard copy or in electronic format. The forms may have pre-entered data.

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Disclaimer

This post is for general overview and guidance and does not in any way amount to professional advice. Hence, www.taxkenya.com, its owner or associates do not take any responsibility for results of any action taken on the basis of the information in this post or for any errors or omissions. Kenyan taxpayers must always rely on the most current information from KRA. Tax industry in Kenya is very dynamic.