The Kenya Revenue Authority (KRA) has explained how taxpayers can resolve disagreements with the taxman without necessarily pursuing lengthy court battles.
The taxman has urged individuals and businesses to consider Alternative Dispute Resolution (ADR).
In a message shared on Thursday, November 12, 2026, encouraging taxpayers to embrace the mechanism, KRA said ADR provides an opportunity for the authority and taxpayers to discuss disputed tax matters and work towards mutually acceptable solutions.
The authority described the process as a faster and more cost-effective alternative to conventional litigation, encouraging taxpayers to engage with it through dialogue rather than allowing disagreements to escalate into prolonged legal battles.
KRA explained that ADR offers a platform where taxpayers can present their concerns and seek an amicable resolution.
“Not every tax dispute needs a courtroom. Through Alternative Dispute Resolution (ADR), KRA and taxpayers can resolve eligible tax disputes through dialogue in a faster, more cost-effective and confidential process. ADR encourages collaboration, builds trust, and helps parties reach mutually acceptable solutions without prolonged litigation,” KRA stated.
According to KRA, taxpayers who wish to use the mechanism are required to complete an ADR application form and submit it together with supporting documents relating to the dispute.
The application is submitted to the Tax Dispute Resolution Office at Ushuru Pension Towers, Block B, 7th Floor, in Upper Hill, Nairobi.
KRA’s published application form also provides for submission of scanned applications and supporting documents through the email address ADR@KRA.GO.KE.
The application should provide the taxpayer’s details, information about the dispute and its status, as well as the relevant supporting evidence.
Once the process begins, three key parties are involved: the taxpayer, the Commissioner or the Commissioner’s representative, and a facilitator who guides the discussions.
Unlike arbitration, where an arbitrator can make a binding decision, KRA’s ADR process is facilitated mediation. The facilitator does not impose a settlement but helps the parties explore areas of agreement and arrive at a solution acceptable to both sides.
KRA expects participants to engage openly and fairly, disclose all material information relevant to the dispute, attend scheduled meetings and observe agreed timelines.
The process is also guided by confidentiality requirements, allowing the parties to discuss the disputed issues in a structured environment.
If the parties reach an agreement, the settlement is documented in an ADR agreement setting out the terms accepted by both sides.
However, ADR is voluntary. Neither the taxpayer nor KRA can be forced to participate in the process, and a settlement must remain within the Constitution and applicable tax laws.
KRA’s guidelines provide for ADR in a wide range of tax disputes, but the mechanism has exceptions.
The authority says ADR cannot be used where a proposed settlement would go against the Constitution, revenue laws or other applicable legislation.
It may also be unsuitable where a dispute requires a technical interpretation of the law, where judicial clarification would be in the public interest, or where there is already an undisputed court judgment or ruling on the matter.
The process also cannot proceed where one of the parties is unwilling to participate.
KRA’s current guidance provides for a 120-day timeline for ADR proceedings under Section 55 of the Tax Procedures Act. Where a court initiates ADR, the applicable timeline depends on the directions issued by the court.
KRA’s latest appeal builds on a framework that has existed for several years.
The mechanism is anchored in Article 159(2)(c) of the Constitution, which recognises the use of alternative forms of dispute resolution, including reconciliation, mediation and arbitration.
It is also provided for under Section 55 of the Tax Procedures Act, 2015, and Section 28 of the Tax Appeals Tribunal Act, 2013.
KRA adopted ADR for tax and customs disputes in 2015 and subsequently developed a framework to guide negotiations between taxpayers and the authority.
The mechanism is designed to complement the existing tax dispute resolution process, which can involve a taxpayer objecting to a tax decision by the Commissioner before proceeding to the Tax Appeals Tribunal or the courts.
KRA has previously said ADR can help reduce the time and costs associated with litigation, ease the backlog of disputes and preserve working relationships between the authority and taxpayers.
The authority has also described the process as free of charge, although taxpayers may still incur their own expenses where they choose to engage professional advisers.
For taxpayers facing disputed assessments or other tax disagreements, ADR therefore provides another avenue to explore before committing to lengthy proceedings, provided the matter qualifies and both parties agree to participate.
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