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With the deadline for filing individual income‑tax returns set at June 30 each year, the Income Tax Act offers four specific deductions that can reduce taxable income.
We outline each relief, its limits, required documentation and the process for claiming it on iTax.
1. Mortgage‑interest relief
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A deduction is available for interest paid on loans from approved financial institutions to purchase, construct or improve a residential property.
The maximum annual relief deduction is Sh360,000 (Sh30,000 per month)
In practical terms, if interest paid in a year totals Sh280,000, the full Sh280,000 may be deducted. If interest paid is Sh400,000, the deduction is capped at Sh360,000.
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Required documents
Mortgage statement showing interest paid.
Lender’s certificate of total interest.
Proof of property ownership (title deed or registry extract).
2. Insurance‑premium relief
KRA staff working on their desks
This relief simply allows you to claim a 15 percent deductible on life, health or education policy premiums for you, your spouse or children.
The relief rate is 15 per cent of premiums paid, capped at Sh60 000 per annum (Sh5 000 per month)
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Required documents
Receipts for all premiums paid.
Policy schedules indicating coverage terms and beneficiaries.
In a practical example, say Mary pays Sh100,000 for life cover, Sh80,000 for family health and Sh70,000 for her children’s education policy, bringing her total premiums to Sh250,000.
Under the 15 per cent relief rate Sh37,500 is deducted from her taxable income.
Joseph’s combined premiums, among them Sh200,000 for life insurance, Sh150,000 for health and Sh150,000 for education, total Sh500,000.
Although 15 per cent of that is KES 75,000, the relief is capped at KES 60,000, which is the maximum Joseph can claim.
3. Retirement‑fund contributions
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Taxpayers at a KRA help centre
What is it? A deduction for amounts you and your employer contribute to a registered pension, provident or individual retirement fund.
The allowable relief is the lowest of:
Total contributions in the year.
30 per cent of pensionable income.
Sh360,000 per year (Sh30,000 per month).
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Required documents
An annual contribution statement from the retirement fund.
Your employer’s remittance advice if they contributed on your behalf. KRA uses this document to verify that the contributions were remitted to the registered fund, to confirm the dates and amounts, and to prevent duplicate or fraudulent claims.
4. Charitable‑donation relief
KRA staff working on their desks
Charitable‑donation relief allows you to deduct cash gifts made during the year to organisations that hold a current tax‑exemption certificate.
To qualify, your total deduction must not create an overall loss for the year, and no more than 50 per cent of your annual donations can go to entities that are not directly connected to your business or personal activities.
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To claim, you must submit:
An official receipt from the charity showing its PIN and your details
Documentation (such as photographs or project reports) demonstrating how your donation was used
A copy of the charity’s valid tax‑exemption certificate.
For example, if you donate Sh50,000 to a registered children’s home and provide all three documents, you may deduct the full Sh50,000 from your taxable income.
How to claim reliefs on iTax
KRA headquarters at Times Tower, Nairobi
Access the iTax portal at itax.kra.go.ke and select “File Return.”
Under the Deductions section, click “Add Deduction” and choose the appropriate relief type.
Enter the claim amount and upload scanned copies of supporting documents.
Validate entries and submit the return on or before June 30 to avoid penalties.
Each of these deductions must be supported by the prescribed documentation.
Taxpayers should confirm figures against official statements, assemble all certificates in advance and submit returns early to secure entitled reliefs.