What KRA has said
- March 2026: Deputy Commissioner Maurice Oray said KRA has financial data on many people who file nil returns despite clear activity on their mobile wallets.
- May 2026: Commissioner for Micro and Small Taxpayers George Obell told a Meru Citizen Assembly that personal transfers are off the table. KRA is after payments through paybills, till numbers and other merchant channels.
- October 2026: KRA was reported to be checking payroll and M-PESA records against electronic invoices and withholding tax data to test what people declare.
What is coming next
KRA plans pre-filled tax returns: it loads what it already knows about your income, and you confirm it or explain why it is wrong. It is also building a Virtual Electronic Tax Register that would plug into payment platforms so that a business receiving digital payments issues tax invoices at the point of sale. KRA said in May that it was still in talks with payment providers about how to roll this out, so it is not live yet.
What it means for you
| If you | What to do |
|---|---|
| Only send and receive money with family and friends | Nothing changes. KRA says this is not what it is looking at. |
| Sell through a till or paybill | Register for the right tax, keep records and issue eTIMS invoices. |
| File nil returns but run a side business | Stop filing nil. File the income, often under turnover tax for a small business. |
| Receive loans, gifts or refunds on M-PESA | That money is not business income. Keep the messages in case KRA asks. |
Questions people ask
Is KRA watching my personal M-PESA transfers?
KRA says no. Its Commissioner for Micro and Small Taxpayers said in May 2026 that money you send family or friends is not what it is after.
What is KRA looking at?
Payments that run through paybills, till numbers and other merchant channels, in other words business income. It has also said it holds data on people who file nil returns while their wallets show clear business activity.
Is all money in my M-PESA counted as income?
No. Reports in October 2026 noted that money moving through a wallet does not automatically count as taxable income. Gifts, loans and transfers between your own accounts are not business income.
What should I do if I run a till?
Register for the right tax, issue eTIMS invoices for your sales, and stop filing nil returns if the business earns money.
Related
- eTIMS: who must use it and how to register
- Turnover tax, rental income or income tax
- Filing a nil return
- KRA hub
Sources
- Techweez, 8 May 2026: KRA on personal transfers, paybills and tills, pre-filled returns and the Virtual ETR.
- Education News, October 2026: KRA checking payroll and M-PESA records.