With proper planning, tax filing doesn’t have to be stressful. Here are essential tips to help freelancers and consultants in Kenya stay organised, reduce their tax burden, and avoid penalties.

1. Understand Your Tax Obligations

As a freelancer or consultant, you’re considered self-employed and are responsible for obligations such as:

• Income tax (filed annually via KRA’s iTax)
• Installment tax (paid quarterly if applicable)
• Turnover Tax (paid monthly if applicable)
• SHIF and NSSF contributions

Ensure you’re filing the correct return type based on your income level and structure.

2. Keep Accurate Financial Records

Good recordkeeping is essential for proper tax filing. Use tools like Expensify and Google Sheets or Excel to track:

• All income received from clients
• Expenses related to your consulting work (e.g. communication, transport, subscriptions)
• Invoices issued and payments received

Keep receipts and supporting documents for at least five years, as required by KRA.

3. Set Aside Some Cash for Future Estimated Tax Payments

Since taxes fully aren’t withheld from your earnings as they are for traditional employees, you need to set aside some cash to make estimated tax payments at the end of the year. Failure to make timely filings and payments can result in penalties and interest.

4. Claim Allowable Deductions

Freelancers and consultants can lower their tax liability by deducting legitimate business expenses, such as:

• Office supplies: Printing materials, notebooks, and equipment
• Business-related travel: Transport and accommodation costs for client meetings or fieldwork
• Professional services: Fees paid to lawyers, accountants, or subcontractors
• Insurance and pension contributions: Medical cover and retirement savings may be deductible

These deductions must be directly related to your consulting work and well-documented.

5. Consult a Tax Professional

Kenyan tax rules for consultants can be complex, especially if you have foreign income, multiple clients, or claim various deductions. A tax professional can:

• Help you calculate accurate taxes
• Ensure you’re complying with all KRA requirements
• Advise you on the best filing option (income tax vs. TOT)
• Assist in claiming all relevant deductions

This can save you both time and money, and help you avoid costly mistakes.

6. Stay Informed About Tax Changes

Kenyan tax laws change frequently. To stay compliant and take advantage of new tax reliefs or rates, stay informed through:

• The KRA website
• Reliable newsletters or blogs – subscribe to the Zidika Consulting newsletter
• Annual consultations with your accountant

Being proactive ensures you won’t miss out on new benefits or fall into non-compliance.