Jan 2024: non-residents required to register on Electronic Tax Invoice management system (TIMS)
The Kenyan Revenue Authority KRA now requires any non-resident businesses to register on TIMS to generate e-invoices for supplies to domestic customers. This is a requirement even if the foreign business is not VAT registered in Kenya.
There will be a 3-month grace period until 1 April 2024 to register without penalties.
June 2023: TIMS full implementation
Since 1 June 2023 only purchase invoices cleared through the Electronic Tax Invoice management system (TIMS) government system may be used to deduct input VAT by taxpayers. This now applies to all taxpayers. In order to comply, the VAT traders are required to adopt a compliant ETR to record their transactions from the approved ETR Suppliers.
Non-resident VAT registered businesses fall outside the scope of TIMS.
The original plan was for 1 August 2022, but has now been delayed three times. The KRA is introducing pre-filled VAT returns from 1 January 2024 based on tax invoice reporting.
Tax registers with live reporting to the Revenue Authority
The Kenya Revenue Authority KRA started in August 2021 the operations of e-invoicing cash registers under which taxpayers to maintain a tax register that is able to transmit tax invoice data to the Kenya Revenue Authority (KRA) system.
The new Electronic Tax Invoice management system (TIMS) obliges VAT registered businesses to electronically record every transaction through a government-sponsored receipting system. The KRA has been piloting live invoice registration and checking terminals with TIMS since 2019.
Check VAT Calc’s global live VAT invoice transaction and e-invoice reporting tracker to see where else real-time submissions of invoices is being implemented.
Key features of TIMS – approved tax registers
Each VAT registered business will follow the key points below
- Each transaction will be recorded through an approved tax register, with a unique serial number with the electronic invoice being delivered to the customer and the Commissioner of Taxes.
- The purchaser must supply their own unique PIN if they wish to recover any VAT through their own VAT return.
- Approved registers will be purchased by the taxpayer, but they are then responsible for use and maintenance
- VAT invoices must contain the typical transactional data, including PIN numbers, a unique invoice number and an invoice QR Code
- Registers will transmit daily batch invoice summaries to the KRA.
