Lecture 113 Β· The taxman froze a lawyer's account for a company's debt, and he had resigned as its director years before.
π»ππ πͺπππ πΉπππ: KRA froze a Nairobi lawyer's personal account for a company's KSh 20 million VAT debt, though he had resigned as its director years before and the company never updated the record. The tribunal held the agency notice void, and the High Court ordered the seized money repaid with interest and KSh 500,000 in damages.
Illustration: Precursor
You resigned as a director of a company years ago, signed the papers, and handed over your shares. The company never updated its records, so the registry and the tax portal still show your name. Then the authority declares you an agent for that company's unpaid tax, freezes your personal account, and takes your savings for a debt that was never yours.
Put yourself in the former director's chair. When the authority freezes your account for a company's tax debt, does resigning years ago set you free?
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Precursor is published by the FinTech Association of Kenya and exercises independent editorial judgement under the Editorial Independence Charter. This article is labelled Precursor Executive Classroom, which marks commercial material. Knowledge on Tax and financial judgement.
Lecture 126 Β· A director kept meeting the taxman instead of appealing, and four years on the bill had only grown.
π»ππ πͺπππ πΉπππ: KRA confirmed a KSh 899,328 income-tax bill against Saphira, and its director spent four years in meetings and relied on his compliance certificates instead of appealing. The tribunal held meetings do not stop the thirty-day clock, a certificate is not proof of payment, and refused leave to appeal out of time; the debt had grown to KSh 1.4 million.
Tax and financial judgement Β· 4 min read Β· Paid
Lecture 125 Β· A rice importer called cleaning and repacking manufacturing, and the court said packaging is not making.
π»ππ πͺπππ πΉπππ: Mjengo claimed an investment deduction on KSh 1.5 million of machinery that cleaned and repackaged imported rice, calling it manufacturing. Through three forums the ruling held that packaging alone is not making goods, the rice remained rice, and a definition framed with 'means' is exhaustive. The deduction was refused.
Tax and financial judgement Β· 4 min read Β· Paid
Lecture 124 Β· A contractor said the money was his clients', had no agreements to show it, and the assessment stood.
π»ππ πͺπππ πΉπππ: KRA billed MU-BEI KSh 1.7 million after its eTIMS invoices far exceeded its declared sales. The company said the money was clients' funds for materials, passed on as an agent, but had no written agency agreements and no reconciliation. The tribunal held VAT fell due on the invoices and dismissed the appeal.
Tax and financial judgement Β· 4 min read Β· Paid