KRA To Vet Capital Gains Tax Exemptions
The Kenya Revenue Authority (KRA) has enhanced the itax system to Closely monitor exemption declarations on transactions that attract capital gains tax.
With the new enhancement in place, KRA can now accept or reject exemptions declared by the taxpayers in the course of their transactions thereby enhancing transparency and efficiency.
KRA will now be able to grant or deny CGT exemptions depending on whether or not the transactions meet the exemption guidelines provided for in the income tax act. CGT exemptions are provided for under the first and eighth schedules of the income tax act.
Among the transactions exempted from CGT include land whose value is not more than 3 million shillings, agricultural property having an area of less than fifty acres and property, which is transferred or sold for the purpose of administering the estate of a deceased person.
Capital gains tax is a tax chargeable on the transfer of a property such as land and buildings located within Kenya. It is payable by the party transferring the property.
KRA commissioner of domestic taxes, Elizabeth Meyo has said the enhancement significantly boosted KRA’S collection on capital gains tax in July, 2019 to 580 million shillings against a target of 391.2 million shillings.