Lecture 25 Β· Customs saw rice that KRM's ledger did not
π»ππ πͺπππ πΉπππ: KRA matched a rice importer's customs entries against its purchase ledger and found shipments missing from the books. The company said it had sent documents. The Tax Appeals Tribunal asked which documents, and for what.
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The case
KRM Commodities Ltd imported and distributed rice. Comparing customs data with its purchase ledgers and returns for 2021 to 2023, KRA found unreconciled variances of KSh 11.3m for 2021 and KSh 184.6m for 2023. It also found that the company had paid audit, legal and quota fees without deducting withholding tax.
KRA assessed the company on 31 July 2025. KRM objected four weeks later. Duties and taxes, it said, were already in its direct expenses and KRA had counted them twice. KRA's 20% gross margin was arbitrary. The government had allowed duty-free rice imports in 2023. And some of the imports belonged to another company, which had used KRM's unused quota.
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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.
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π»ππ πͺπππ πΉπππ: A catering company lost most of a KSh 4.4m dispute because its bank deposits ran ahead of its declared sales and its expenses lacked proof of payment. Its further documents arrived seven days after KRA's decision, and nothing in the law let KRA look at them.
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