Section 59

Production of records 

(1) For the purposes of obtaining full information in respect of the tax liability of any person or class of persons, or for any other purposes relating to a tax law, the Commissioner or an authorised officer may require any person, by notice in writing, to—

• (a) produce for examination, at such time and place as may be specified in the notice, any documents (including in electronic format) that are in the person’s custody or under the person’s control relating to the tax liability of any person; 
• (b) furnish information relating to the tax liability of any person in the manner and by the time as specified in the notice; or 
• (c) attend, at the time and place specified in the notice, for the purpose of giving evidence in respect of any matter or transaction appearing to be relevant to the tax liability of any person. 

2) If the person required to produce documents under subsection (1)(a) is a financial institution—

• (a) the documents shall not, while they are being examined, be removed from the premises of the financial institution or other premises at which they are produced; 
• (b) the Commissioner or authorised officer carrying out the examination may make copies of such documents for the purposes of any report relating to the examination; and 
• (c) the confidentiality of the information obtained in the course of the examination by the Commissioner or authorised officer shall be maintained and the information shall be used solely for the purposes of the tax laws.

(3) The Commissioner or authorised officer may require that the information referred to in subsection (1) be—

• (a) given on oath, verbally or in writing, and, for that purpose, the Commissioner or authorised officer may administer the oath; or 
• (b) verified by a statutory declaration or in any other manner that the Commissioner may prescribe. 

(4) This section shall have effect despite –

• (a) any law relating to privilege or the public interest with respect to the giving of information or the production of any documents (including in electronic format); or
• (b) any contractual duty of confidentiality.

(59A*) Data management and reporting system. (Finance Act 2023 wef 1st-September-2023 s63*)

(1) The Commissioner may establish a data management and reporting system for the submission of electronic documents including detailed transactional data relating to those documents. 

(1A**) The Commissioner may, by notice in writing, require a person to integrate the electronic tax system authorised under section 75 to the system referred to in subsection (1) for the purposes of submission of electronic documents including detailed transactional data in the prescribed form. 

(1B**) The Commissioner shall not require a person to integrate or share data relating to— 

(a) trade secrets; and 

(b) private or personal data held on behalf of customers or collected in the course of business. 

(1C**) A notice under subsection (1A) shall be for a reasonable period but not exceeding one year and depending on the nature of the business of that person. 

(1D**) The provisions of subsection (1A) shall only apply to a business whose turnover exceeds five million shillings.  (TPAA 2024 wef 27th December, 2024 S8**)

(2) The Commissioner shall notify in writing the persons required to submit electronic documents through the system established under subsection (1). 

(3) The electronic documents referred to in subsection (2) include electronic invoice returns— 

(a) of payments made by a person in the ordinary course of business where goods were exchanged for consideration by a person not employed in the business; 

(b) for payments made by a person in the ordinary course of business where services were rendered, or in anticipation of services to be rendered, by a person not employed in the business; 

(c) for payments for services rendered, or in anticipation of services to be rendered, in connection with the formation, acquisition, development, or disposal of a business or a part of it, by persons not employed in the business; 

(d) for periodical or lump sum payments in respect of a royalty; or 

(e) for such other commercial or financial transaction as may be designated by the Commissioner. 

(4) For the purposes of this section— 

(a) “transactional data” includes— 

(i) the names and addresses of each person to whom a payment was made; 

(ii) where the payment is for services, the amount of the payment specifying whether the payment is a commission of any kind or is for expenses incurred in connection with rendering the services; 

(iii)where the payment is in any form of valuable consideration other than money, the particulars of the consideration; and 

(iv) such other particulars as the Commissioner may specify; 

(b) references to payments for services include references to payments in the nature of commission of any kind and references to payments in respect of expenses incurred in connection with the rendering of services; and 

(c) references to the making of payments include references to the giving of any form of valuable consideration, and the requirement imposed by paragraph (a)(iii) to state the amount of a payment shall, in relation to any consideration given otherwise than in the form of money, be construed as a requirement to give particulars of the consideration.

(5) A person who fails to comply with the notice given under subsection (1A) commits an offence and shall be liable, on conviction, to a penalty not exceeding one hundred thousand shillings for every month or part thereof that the failure continues.  (TPAA 2024 wef 27th December, 2024 S8*)

(6) A person who fails to comply with the notice given under subsection (2) commits an offence and shall be liable, on conviction, to a penalty not exceeding one hundred thousand shillings for every month or part thereof that the failure continues. 

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