In a move that has sparked widespread debate across Kenya, the kenya Revenue Authority has stepped up efforts to boost tax compliance, turning its focus to employed individuals with side hustles and unexplained bank deposits.
Recent public notices and court rulings have placed these income streams under renewed scrutiny, reinforcing the requirement that all earnings must be declared.
The end of "off-the-books" earnings as the taxman leverages bank data and eTIMS validation.
The developments come at a time of growing economic pressure, with many Kenyans relying on multiple income sources to stay afloat amid a high cost of living.On February 3, 2026, KRA issued a public notice clarifying that salaried employees earning additional income must declare all their earnings in a single annual tax return.
The authority emphasised that filing returns based solely on employment income deducted through Pay As You Earn (PAYE) does not present a complete or accurate tax position where extra income exists.
According to KRA, additional income includes freelancing, consultancy, online services, farming, rental income, and other side businesses.
Taxpayers are expected to use their P9 form as a starting point and then add any supplementary or irregular income earned during the year.The 2026 tax return filing window runs from January 1 to June 30. KRA also reminded Kenyans that anyone with a KRA PIN — even those with no taxable income — is required to file a Nil Return.
The clarification quickly gained traction online. A post by finance-focused account @moneyacademyKE on X (formerly Twitter) highlighted the directive and attracted hundreds of reactions.
The post reiterated that employed Kenyans with side hustles must consolidate all income sources into one annual return.
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