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AK: Athletes will pay tax

22 January 2014, 17:40

Nairobi - High earning Kenyan runners are ready to comply with the directive requiring them to remit taxes to the country, Athletics Kenya boss Isaiah Kiplagat, declared Wednesday.

Kiplagat also issued a circular to all foreign managers requiring them to submit information to be used to file returns concerning their clients by the end of February.

Kiplagat was reacting to measures published on Tuesday by the Commissioner for Domestic Taxes at the Kenya Revenue Authority (KRA) requiring all sportsmen in the country to pay levies on their income.

Distance runners account for the highest paid sportspersons in the East African nation and the initial announcement requiring them to submit taxes were met with harsh criticism in 2012 where a number of them were slapped with bills running into hundreds of thousands of dollars in back taxes.

"This morning, I have sent an email to all agents requiring them to submit returns of all athletes in their management detailing amount earned, tax paid and in which country it was paid."

"Once these are received by the athletes, they will pass it on to the tax experts to make returns on their behalf and there will be no problem," Kiplagat said.

The president added they had invited KRA officials at a seminar attended by top athletes in Eldoret last month where they were taken through the requirements of the new measures.

While stating the willingness of all athletes to comply, "like all other Kenyans," Kiplagat expressed fears their foreign managers could prove to the stumbling block in implementing the directive.

"The only problem is if the agents withhold the information and I have made it clear that information required must be submitted and we have asked them to give us copies."

"It has become a public issue and we have to see where we can assist. The purpose of getting information to us is to help those athletes with nowhere to go since we have our accountants who can assist them file at a fee at AK," he said.

The president assured that top runners had moved to abide by KRA's wishes by acquiring the services of accountants and tax experts.

On the issue of back taxes, Kiplagat revealed a formula had been agreed with the taxman to spare the athletes from incurring heavy penalties.

"They raised this issue and were told how to go about it. If you have a back log, let's say you have not made your returns for the last three years, you can make it and appeal and show why you did not do it."

"They need to show their accounts that have no taxes and the Ministry (Sports, Culture and Arts) and AK can assist them," Kiplagat said.

KRA published measures on Tuesday requiring all earning from sportspersons declared and taxed accordingly in line with all other citizens who submit annual returns in June every year.

According to Kiplagat, runners have nothing to be concerned about since their income is levied in the countries where they race.

"If an athlete is taxed in the country they run in, the difference between the taxation levels in that country and Kenya is what they are required to pay."

"The athlete is required to file genuine expenses such as air tickets, training costs, agent fees, medication and accommodation. If they do that properly and get a tax expert to file their returns, most of them will not pay any tax," he explained.

The AK boss has also sent circulars to all event organisers and sponsors urging them to comply with the directives for their races to run countrywide.

- Xinhua


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