End of Financial Year Checklist for Kenyan Businesses (July 2026)

July brings a compliance squeeze for Kenyan businesses. Your financial year close, tax returns and payroll deductions all collide on tight deadlines. If your business runs on a calendar year (January to December), most of your heavy lifting was already due by June 30. But if you close on any other date, or if you missed something, you are now in the danger zone. KRA showed zero patience in June—it rejected extension requests and penalised late filings. The same firmness applies through July.

Here is what matters most this month for your financial year end.

File your tax return on time

Companies must file their annual income tax return by the end of the sixth month after year-end. For a December year-end, the deadline is 30 June. If your June 30 deadline has passed, check whether you already missed it. If you did, file now and prepare for penalties. Late filing attracts penalties starting from KES 2,000 plus 5% of unpaid tax per month.

A company may choose its own financial year end, provided it covers a twelve-month period. Any change to this must be approved by the Commissioner of the KRA. So if your year ends on, say, September 30, your return is due by 31 March of the following year. Do not guess—check your incorporation papers or ask your accountant.

From January 2026, KRA validates declared income and expenses against eTIMS and withholding tax data, making accurate filing critical. A mismatch between your return and what KRA already knows about your business—from TIMS readings, supplier withholdings, or import records—will flag your file for audit. File the figures that match your records and those sources, not figures you wish were true.

Log into itax.kra.go.ke, prepare your profit and loss account and balance sheet, and upload them with your return. KRA tax experts on Kaziiko can walk you through this if you get stuck.

Close the payroll loop

Payroll deductions are the simplest thing to get wrong because the rules keep shifting. PAYE, SHIF, NSSF, and the Affordable Housing Levy are all remitted by the 9th day of the month following the payroll period. In July, you owe June's remittances if you have not sent them already. Check your KRA account on iTax.

The order matters. NSSF, SHIF and the Housing Levy are all allowable deductions taken off gross before PAYE is worked out—they are no longer applied to the tax afterwards. This lowers your taxable pay, which lowers your PAYE. If your payroll system is old, it probably deducts these the wrong way, overstating the tax your staff actually owe. Fix this now.

For a KES 100,000 gross salary: NSSF is 6% within the Year 4 cap, SHIF is 2.75% of gross, and the Housing Levy is 1.5%. After those three come off, then you charge PAYE on what remains. Resident personal relief reduces the resulting tax by KES 2,400. Double-check June's payslips in your system before you run July's. Many payroll bugs hide in old configurations.

Reconcile your books

Your financial statements must be ready before you file tax returns. Private companies must lodge financial statements within nine months after the end of the financial year, while public companies must do so within six months. This is a separate deadline from tax filing, enforced by the Companies Registry via eCitizen, not by KRA.

Compare your bank statements, sales records (especially TIMS readings if you are VAT registered), and expense receipts. Open invoices, unbanked cheques, or stock write-offs that did not make it into the books will cause mismatches. These take time to fix. Do them now, not at midnight on the filing deadline.

File your annual company return

Your annual return date is either the anniversary of your company's incorporation or the anniversary of the last annual return filed at the Companies Registry. Your annual return must be delivered within 28 days of that date. Use the CR29 form on eCitizen. The portal often moves slowly near the end of the month, so start early.

Your CR29 includes current directors, shareholders, company secretary details, and confirmation of share capital. If you have added or removed directors or shareholders since the last filing, update the form now.

Quarterly tax instalments

Companies generally pay instalment tax in four instalments during the year, on the 20th day of the 4th, 6th, 9th, and 12th months of the financial year. For a December year-end, that is 20 April, 20 June, 20 September, and 20 December. The June instalment should already be paid. If you have not sent it, treat it as urgent. If you close on another date, work out which instalment months apply to your year.

Instalment tax is calculated on estimated profit. If your profit is smaller than last year, you can apply to KRA to reduce the amount. This takes time, so if you have not done it yet and the reduction would be significant, contact a verified Kenyan expert on Kaziiko for help with the application.

VAT and other monthly taxes

VAT returns and payment are due by the 20th of the following month, and Turnover Tax by the 20th. If you are VAT registered or operate under the Turnover Tax system (applicable to businesses with turnover below a certain threshold—check KRA's current rules on kra.go.ke), these deadlines apply every month. If your business is not compliant with June and July VAT, the penalties stack fast.

Use the iTax portal to file and pay. Do not delay monthly returns waiting for the annual return. They are separate obligations and late payment triggers interest immediately.

Check for withholding tax obligations

If your business makes payments for services—contractors, consulting fees, auditor bills—that exceed certain thresholds, you must withhold tax and remit it to KRA. The thresholds vary by payment type. Check your June and July invoices. Failure to withhold when required exposes your business to personal liability.

Consult the KRA withholding tax notice on kra.go.ke for the current thresholds, or ask an accountant to review your payments. It is easier than dealing with a penalty notice later.

Back up everything

Before you file anything, back up your financial records—bank statements, invoices, receipts, payroll runs, TIMS data, everything. Keep copies offline. If KRA asks questions later (and it will, especially for businesses flagged by the eTIMS reconciliation), you need proof of what happened. Poor record storage has cost more businesses than bad compliance.

Frequently Asked Questions

When exactly do my tax returns expire?

The Kenya Revenue Authority (KRA) has issued a firm reminder that taxpayers must file their 2025 Income Tax Returns by midnight on Tuesday, June 30, 2026, with no extension expected. KRA said: "Taxpayers must submit on or before 30th June 2026, in accordance with the law." If you run a calendar year and missed this, you are late now and penalties are automatic. If your year ends on a different date, your deadline is six months after that date.

What happens if I file late?

Failure to file attracts a penalty of KES 2,000 or five percent of the tax due, whichever is higher. File immediately to limit the damage. KRA does not forgive late filing—it is automatic once the deadline passes. Calculate your penalty using the KRA penalty calculator to see what you owe.

Do I need an auditor for my financial statements?

Not all businesses do. Small companies may benefit from simplified reporting requirements, but you remain subject to statutory filing obligations. Check the Companies Act to see if your business qualifies for exemption. If you have any doubt, prepare a full set of audited statements—they protect you in an audit and may even reduce your KRA penalty if they are done well.

Can I file returns if I do not have all my records yet?

No. KRA cross-checks your figures. If you file incomplete numbers, KRA flags you for audit and you face corrections, interest and penalties. If your records are disorganised, spend time now sorting them—supplier invoices, bank statements, TIMS receipts. It is faster than explaining gaps to KRA later.