After the passing of the Finance Bill 2026, the Kenya Revenue Authority (KRA) has now reopened a tax amnesty that wipes out penalties, interest, and fines on eligible old tax debts accrued up to the 31st of December, 2025.
This tax amnesty program, brought back after a similar one was run back in 2023, was introduced after the Finance Bill 2026 was signed into law by President William Ruto.
Part of the Tax Procedures Act, Sec. 37E Cap. 4698 was amended by deleting the expression ’31st December, 2023′ and substituting it with the expression ’31st December, 2025′.
According to the tax authority, a tax amnesty is a limited-time offer targeted at a class of taxpayers with the aim of achieving a specific objective.
KRA claims the previous two amnesty programs earned the government KES 80.9 billion in tax liability payments while regularising thousands of taxpayers.
The latest relief on penalties took effect on July 1 and runs to December 31, 2026.
What it means is that a taxpayer who has paid all the principal taxes that were due by 31st December, 2025, is currently entitled to an automatic waiver of the penalties and interest related to that period.
They will not be required to fill out an amnesty application.
The same automatic relief also applies to taxpayers who do not owe principal tax but still have late-filing penalties, provided all outstanding returns are filed.
How Tax Amnesty Waiver Works and Who is Excluded
If you pay the outstanding pre-2026 principal tax in a lump sum, the waiver on penalties and interest is immediate.
In case a taxpayer cannot pay outstanding pre-2026 principal tax all at once, they must apply for a structured payment plan through iTax. Notably, the principal taxes under that plan must be fully cleared by December 31, 2026, to completely qualify for the waiver.
The amnesty does not cover tax liabilities that arise on or after January 1, 2026.
“Tax liabilities arising on or after 1st January 2026 do not qualify. All principal taxes, penalties, and interest remain fully due.” KRA states in a notice.
It also does not apply to principal amounts already in active court cases; the KRA says such taxpayers should use the Alternative Dispute Resolution process instead.
The authority says the move is an effort to encourage voluntary tax compliance and encourages all taxpayers to check their tax status early on the iTax portal, file any missing returns, and settle eligible principal tax before the deadline.
