The Finance Act 2020 introduced the Voluntary Tax Disclosure programme (VTDP) that is aimed to give an opportunity to tax payers who have undisclosed tax liabilities so that they can disclose the same to the Kenya Revenue Authority without facing any legal consequences or prosecution. This progrmme will be open for three years effective 1st January 2021.

How the Voluntary Tax Disclosure programme (VTDP) will be implemented

This Programme will cover a period of five years before 1st July, 2020. This will be the period 30.06.2020 going back to 01.07.2015.

The application will be entirely voluntary whereby taxpayers shall exhaustively disclose all material facts relating to the undisclosed tax liabilities in question. The application will be to the commissioner in the prescribed application manner.

It is expected that only the principal tax will become due, however the percentage of penalties and interests waived will depend on when one will apply for the relief within the three-year period when the programme will be applicable.

 Upon successful application of the VTDB programme to the commissioner, remission on penalties and interest will be as follows;

  • Taxpayers who will apply within the first year will enjoy a 100 per cent remission of penalties and interest.
  • Those who will make the application in the second and third years of the programme will get to enjoy waivers of 50 per cent and 25 per cent for penalties and interest respectively.

The VTDP Programme shall operate under the following rules:

After being satisfied that the details provided in the application by the taxpayer are accurate, the Commissioner shall grant a relief. Thereafter the Commissioner will enter into an agreement with the applicant, setting out the terms of payment of the tax liability.

Settlements of the tax liabilities will be made within one year from the date of the agreement.  However, if the taxpayer fails to honour the terms of the agreement, in addition to the outstanding tax liability, the full amount of penalties and interest that had been waived under the agreement will become payable.

 Non-eligible taxpayers under the VTDP programme

 The following categories of tax payers will not be eligible for the Voluntary Tax Disclosure Programme

  • Those under Audit or Investigations
  • Those already notified of a pending audit or investigation by the commissioner.


Disclosures under this programme shall remain confidential as assured by the Kenya Revenue Authority(KRA) and Taxpayers who apply for relief and abide by the rules with regards to payment terms shall not be prosecuted on the tax liabilities disclosed.

For more information contact;

Beatrice Kamau

Outsourced Services Manager

t +254 715 248882 |  +254 733 533449 

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