Submitting the monthly PAYE declaration in Kenya is a routine compliance obligation for employers. However, even when filings and payments are made on time, errors can occur that result in a declaration appearing as unpaid on the Kenya Revenue Authority (KRA) system.
Understanding how payment allocations work and how to correct a P10 declaration can help employers avoid unnecessary penalties, investigations and administrative delays.
In Kenya, employers are required to submit their monthly PAYE declaration, commonly referred to as the P10, through the KRA online portal. The declaration and payment must be completed on or before the 9th day of the following month.
The P10 declaration includes:
Once the declaration has been submitted, the KRA system generates an eSlip or payment remittance document. This document contains a unique Payment Reference Number (PRN), which is used to identify and allocate the payment against the specific filing.
One of the most common reasons a P10 declaration shows as unpaid is the use of an incorrect payment reference when making payment to the KRA.
The PRN generated on the eSlip must be used exactly as provided. If an incorrect PRN is entered, or if additional references are included, the KRA system may be unable to match the payment to the associated filing.
In these situations, the payment is often received by the KRA but remains unallocated. The declaration continues to appear as unpaid, despite the employer having settled the amount before the due date.
Unallocated payments are typically routed to a suspense account until they can be manually reviewed and assigned to the correct filing.
Where a payment has not been allocated correctly, employers will generally need to engage directly with the KRA.
Supporting documentation is essential and should include:
In many cases, an in-person visit to a KRA office may be required so that a KRA representative can review the documentation and allocate the payment to the correct employer account.
Each employer in Kenya is assigned a dedicated client manager at the KRA. This official can assist with payment allocation queries, compliance concerns and filing corrections.
The KRA General Ledger provides a detailed view of all filings, payments and allocations recorded against an employer’s account.
Employers can review their Statement of Accounts to confirm that payments have been successfully allocated to the correct declarations.
The statement can be extracted in PDF or Excel format, making it a useful compliance tool and an effective way to identify discrepancies before they become larger issues.
Regular reviews of the General Ledger can help employers ensure that all filings and payments have been correctly processed.
The KRA provides an online correction process for employers who need to amend previously submitted P10 declarations.
There are two types of P10 submissions:
This is the initial declaration submitted for the reporting period.
This declaration is used when corrections are required after the original submission has already been filed.
The amended P10 contains all relevant payroll information, including the original payroll run and any additional payroll runs or adjustments that were processed after the initial filing.
Where an employer has already made payment against the original P10, the KRA system automatically takes the existing payment into account when the amended declaration is submitted.
The system compares the original declaration and payment against the amended figures and calculates any additional amount due or any excess payment already received.
This automated calculation simplifies the correction process and helps ensure that employers only settle the difference between the original and amended declarations.
To avoid unnecessary payment allocation issues and correction requests:
By understanding how payment allocations and P10 corrections work, employers can maintain compliance, minimise administrative delays and ensure that PAYE obligations are accurately reflected on the KRA system.
If this article raised questions or highlighted areas you’d like to understand better, let’s talk.Our team can walk through the details, implications, and practical considerations for your business.
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