Nowadays, no transaction that involves the Government can go through unless one produces a PIN Certificate.So what exactly is this Pin Certificate and why is the Government insisting on production of the same?
What is a Pin Certificate?
Personal Identification Number (PIN) is a number which identifies a person for purposes of transacting business with Kenya Revenue Authority, other Government agencies and service providers.
Who Processes the Pin Certificate?
It is processed by Domestic Tax Department.
Who should Obtain Pin?
- All persons – including both an individual as well as an artificial person (i.e. company, club, Trust, etc)
- A sole proprietorship will use the proprietors individual PIN for all transactions.
- For Company, Directors of the Company and the Company itself should obtain PIN.
Does Pin Have Any Force Of Law?
Yes.
PIN is a statutory requirement under Section 123 of Income Tax Act (Cap 470 Laws of Kenya).
It applies to every person who has income chargeable to tax under the Act or any person whom the Commissioner may so require to have it.
What is the Purpose of Pin?
Under the 13th schedule of the Income Tax Act, transactions requiring Pin include, among others, the following:-
- Registration of title, stamping of instruments by the Commissioner of Lands, and payment of Land Rent.
- Approval of plans, payment of water deposits, application for a business permit, payment of Land Rent by Local Authorities.
- Registration of Motor Vehicles, and licensing under the Traffic Act (Cap 403) by the Registrar of motor Vehicles.
- Registration of Business Names and Companies by the Registrars of Business names and companies.
- Trade licensing by the Ministry of Commerce.
- Application for Value Added Tax registration.
- Underwriting policies by Insurance Companies.
- To facilitate importation of goods, Customs clearing and forwarding at the offices of Commissioner of Customs and Excise.
- Payment of Deposits for power connections at Kenya Power and Lightning Co. Ltd.
- To facilitate all contracts for supply of goods and services to all Government Ministries and Public bodies.
Which Documents Should Bear Pin?
- Self Assessment Returns, Statements or other documents submitted to the Commissioner by any person required to do so.
- Returns, Statement or other document submitted to the Commissioner on behalf of another person should include PIN of the person on whose behalf they are submitted, e.g. an employer who is submitting a return, statement or other document on behalf of his employee should include that employer’s PIN.
Pin Related Offences
Section 132(7) of Income Tax Act provides that any person who, when required by the Commissioner, fails to comply with provisions of this section shall be liable to a default penalty of Kshs.2,000/= for every omission, e.g. if an employer fails to disclose his employees’ PINs, he will be liable to default penalty stated above for each of the employees.
How to apply for a Pin Certificate
This is done online.
Simply click on the KRA website (https://itax.kra.go.ke) and follow the instructions.
General
The application of PIN is fast extending into other sectors of the economy such as banks, Postal Corporation, Telkom Kenya, mobile phone providers e.t.c.
