Chasing a missing withholding tax certificate
What a Kenyan supplier can do when a customer deducted withholding tax but no iTax certificate arrived, and how to track the gap until it does.
By Achekam · · 4 min read · For Running a business businesses in Kenya
The customer paid your invoice less withholding tax, just as expected. That was three months ago. You have looked in your iTax account, searched your inbox and asked the customer's accounts clerk twice, and the certificate still has not appeared. Meanwhile your year-end is approaching and your accountant wants every certificate on the table.
A missing certificate is more than an administrative nuisance. Without it, the tax your customer took from your payment may never count in your favour. This article explains how certificates are supposed to reach you, how to check for one, why it matters for your return, and how to keep the gap visible in your books until it is closed.
How certificates normally reach you
KRA describes a straightforward sequence. The customer, as the withholder, pays you the amount net of the tax deducted. Once the customer remits that tax to KRA, a withholding tax certificate is generated on iTax and sent automatically to you as the payee.
Read that sequence carefully, because it shows where things go wrong. The certificate is triggered by the customer's remittance, not by the payment to you. If you have been paid net but no certificate exists, the first possibility to check is that the tax has been deducted but not yet remitted, or was remitted against the wrong PIN or amount. The deduction happened; the second half of the process did not.
Checking a certificate on iTax
Before chasing the customer, confirm what KRA holds. The iTax portal offers public checkers, including one to verify a withholding certificate, alongside checkers for PINs, tax compliance certificates and withholding agents. If the customer sends you a certificate number, use the checker to confirm it is genuine and matches the payment.
Do the same check whenever a certificate arrives by e-mail rather than through iTax. A certificate that the checker cannot find is not one to rely on in your return.
Why you need it for your annual return
For most payments to residents, KRA says withholding tax is not final. The payee must declare the income and the withholding certificates in its annual return, and pay any balance. KRA also says the payee claims the certificate when filing its annual return.
A worked example in words: your company invoiced a customer for consulting work and received the fee net of withholding. In your annual return, you declare the full fee as income. If the certificate is in hand, the tax withheld reduces what you pay with the return. If it is missing, you have declared income on which tax was taken from you, but you have nothing to set that tax against. In effect, the same tax could be paid twice: once by deduction, once with your return.
That is why certificates should be chased during the year, not in the week before the return is due. The reconciliation side is covered in reconciling withholding certificates.
Asking the customer to remit
When the checker confirms there is no certificate, go back to the customer with specifics rather than a general complaint:
- List the invoices paid net, with the payment dates and the amounts withheld.
- Give your KRA PIN exactly as registered, in case the deduction was remitted against a wrong one.
- Ask whether the tax has been remitted, and if so, on what date and under which PIN.
- If it has not been remitted, ask when it will be.
It can help to remind the customer, politely, that the obligation is theirs. KRA says failure to deduct or withhold and remit withholding tax is an offence attracting penalty and interest, and the penalty for late payment is 5% of the tax due. Pointing that out tends to move the request up a finance team's list.
For non-residents with no permanent establishment in Kenya, KRA treats withholding as a final tax, so the certificate question works differently; this article is about resident suppliers.
Tracking short payments in Achekam
Your own books should show the gap clearly. In Achekam, customer payments are recorded against one invoice or spread across a customer's invoices. A part payment leaves the invoice part-paid, and any extra is held on the customer's account.
Be aware of the current limit. When a customer pays net of withholding tax, Achekam's receipt screens cannot settle the withheld part of the invoice. So record the cash actually received; the withheld amount then stays open on the invoice. Rather than hiding that balance, use it: an open withheld balance is a list of certificates still owed. Agree with your accountant how each one is cleared once its certificate arrives.
Receipts can be re-allocated if one was placed against the wrong invoice, and administrators can refund or reverse a receipt, so mistakes in matching can be corrected without losing the trail.
Using the statement of account as a reminder
Achekam's server produces a customer statement of account as a PDF that can be e-mailed, and the screen shows whether it was sent. Because the withheld amounts remain open on the invoices, the statement shows the customer exactly which balances are outstanding.
Send it with a short covering note: "The balances on the attached statement are the withholding tax deducted from our payments. We have not yet received the certificates for them. Please confirm when the tax was remitted." A statement every month keeps the request in front of the customer's finance team without anyone needing to make another phone call.
Paid net by a consulting client and unsure how to book it? See withholding tax on net payments for consultants. Start today by listing every invoice paid net in the last six months and checking each one on iTax.
General guidance only, not advice on your own circumstances. Tax and payroll rules change: check the current position with the authority or your adviser.
