The Tax Appeals Tribunal has ruled that the Kenya Revenue Authority (KRA) could deem all deposits to a bank account as taxable income if there is insufficient proof to the contrary.
If you own a business in Kenya, you are subject to a series of taxes, including the corporate income tax, which is levied on the company's taxable profits calculated by subtracting all legitimate business expenses from the total gross income.
However, the money deposited in a business account is not taxed directly on the deposit itself but on the sources of income that result in deposits being made.
Some of the allowable expenses include salaries, rent, utility bills, marketing costs and certain capital allowances and must be supported by an eTIMS-generated electronic tax invoice.
