KRA October PAYE deadline: What next for employers who missed the deadline?

Employers who neglected to file or pay October 2026 Pay As You Earn (PAYE) tax by the deadline of Monday, November 9, are advised to take immediate action. They can still file the return and pay the tax, but late compliance will result in penalties and interest charges. According to Kenya Revenue Authority (KRA) guidelines for monthly PAYE returns, employers must submit tax deductions from employees' salaries to KRA within nine days of the end of the taxable month. The deadline for the October return had already passed on November 9, 2026.

To comply, employers should log into KRA's iTax portal, locate the RETURNS section, choose to file the PAYE return for October 2026, complete the return form, and submit it. After submission, the employer must download the acknowledgment receipt for their records. The tax payment process involves accessing the PAYMENTS section, selecting the appropriate payment registration, choosing Income Tax as the tax head and PAYE as the subhead, choosing the month of October, and generating a payment slip for that period. Payments should be made through KRA's approved payment channels.

Late filing incurs a penalty of 25% of the tax due, or Ksh10,000, whichever is greater. Additionally, a late payment penalty of 5% of the tax due applies, plus interest at 1% per month or part of a month, continuing until the full amount is paid. Employers unable to settle the entire amount immediately can request a payment plan via iTax, selecting the PAYMENTS option and then APPLYING FOR A PAYMENT PLAN (NEW).

Eligible taxpayers can propose an installment schedule over up to six months, provided they have a valid PIN, a confirmed liability not currently under litigation, and a genuine inability to pay the full amount at once. Approval is subject to KRA's requirements, and non-compliance with the agreed payment plan can lead to enforcement action.

It is important to note that the 2026 Tax Amnesty program, which offers relief for certain tax debts up to December 31, 2025, does not cover liabilities arising from the October 2026 return. Employers should promptly file the missing return, make payment, or negotiate an approved payment arrangement with KRA. Maintaining all receipts and correspondence related to the tax matter is crucial.