Interest on
Underestimated tax.
Deleted by (TPA 2nd Sch Para 6)
(1) If, for a year of income, the difference between the amount of tax assessed on the total income of a person and the amount of the estimate of the tax chargeable contained in a provisional return of income made by that person in respect of that year is greater than ten per cent of that estimated tax, interest at the rate of two per cent per month shall be payable on the whole of the difference between the tax so assessed and the tax so estimated.
(2) Interest under subsection (1) shall be calculated from the due date as specified in section 92(2).
8of 1997, s.48
(3) Where the Commissioner is satisfied that a difference referred to in subsection (1) was due to some reasonable cause, he may remit the whole or part of the interest payable under this section, and where for a year of income the difference arises wholly or partly from an estimate of tax to be charged made before a change in any allowance, relief or rate of tax, the Commissioner shall remit the interest thereon to the extent to which it is attributable to that change.
Provided that -
(a) the Commissioner may remit up to a maximum of five hundred thousand shillings per person per annum of the interest; and
(b) the Commissioner may remit any amount of interest in excess of five hundred thousand shillings with the prior written approval of the Minister; and
(c) the Commissioner shall make a quarterly report to the Minister of all interest remitted during that quarter.
10of 990,s.58