Overview
This alert brings to your attention our analysis of the Tax Appeals Tribunal (TAT) decision in Vijay Kumar Patel v Commissioner for Legal Services & Board Coordination Services (Tax Appeal E628 of 2025) [2025] KETAT 420 (KLR). On 28 November 2025, the Tribunal delivered a landmark judgment clarifying the timeframe applicable to the five-year limitation on the carry-forward of tax losses introduced with effect from 1 July 2025. The decision further delineates the limits of the Kenya Revenue Authority’s power under Section 31(4) of the Tax Procedures Act to reopen and amend tax assessments beyond the statutory five-year period.
KPMG Tax Alert: Tax Appeals Tribunal Provides Guidance on the Five-Year Limit for Carry-Forward of Tax Losses introduced by the Finance Act 2025.
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Our Comments
This decision reinforces critical principles of tax certainty, administrative fairness, and statutory limitation within Kenya’s tax system. The Tribunal made clear that: – The Kenya Revenue Authority (KRA) cannot reopen or amend assessments beyond five years unless it can prove wilful neglect, fraud, or evasion with concrete evidence. Allegations unsupported by evidence are insufficient to override statutory limitation. Overall, this judgment strengthens taxpayer protection against the arbitrary reopening of closed years and underscores the need for KRA to exercise its powers strictly within the statutory and constitutional framework.
