The tax authority plans to compare mobile payment records with tax returns and audit employers over low payroll deductions.
The Kenya Revenue Authority (KRA) plans to use commercial mobile payment records to identify businesses with undeclared income. The proposed checks would cover Till Numbers and Pochi La Biashara accounts.
In submissions to the National Assembly’s Finance and Planning Committee, KRA outlined plans to compare transaction data with taxpayer returns. The authority aims to identify businesses that either understate earnings or do not file returns.
Mobile records to help detect undeclared income
Under the proposal, KRA would draw on third-party financial information, including mobile wallet records, to check business earnings. It also intends to bring non-filing business operators into the active taxpayer base.
The authority said its compliance checks target discrepancies between tax returns and electronic Tax Invoice Management System (eTIMS) data. They also cover non-filers and taxpayers with high tax credits. Together, these categories account for 42 per cent of the domestic VAT register, KRA said.
The proposal forms part of efforts to widen the tax base and address a reported Ksh132 billion revenue shortfall. KRA’s figures show collections of Ksh2.844 trillion for the financial year ending June 2026, against a Ksh2.977 trillion target.
Meanwhile, the authority reported a Ksh26.275 billion deficit in the first quarter of the 2026/2027 financial year. Collections reached Ksh749.678 billion, compared with a target of Ksh775.953 billion.
Employers face payroll compliance audits
Beyond mobile payment checks, KRA also plans to audit employers reporting large workforces but low Pay As You Earn (PAYE) remittances. The authority told legislators it would focus on high-value employers as part of its payroll compliance push.
For these checks, KRA intends to compare employer and payroll information with third-party records and Housing Levy deductions. It will also reconcile employment records to identify companies reporting workforces while remitting little or no Housing Levy.
The broader payroll compliance exercise has already flagged an estimated Ksh5.3 billion in potential revenue, KRA said. That estimate covers non-remitting employers and uncollected deductions, alongside the authority’s wider efforts to improve compliance.
