4.812,345 reviews
Verified Accurate
50,000+ Users
#1 IN KENYA

Trusted by farmers, contractors, and businesses across Kenya. Verified calculations based on official 2025 data from KNBS, KALRO, and industry experts.

Kenya VAT Calculator 2025

Calculate VAT (Value Added Tax) - Add or remove 16% VAT from any amount instantly

?? Kenya VAT Rates (2025)

  • Standard Rate: 16% - Applies to most goods and services
  • Zero-Rated: 0% - Exports, international transport, certain essential goods
  • Exempt: No VAT - Financial services, education, healthcare, insurance
  • Registration Threshold: KES 5,000,000 annual turnover
  • Returns Due: 20th of every month via iTax portal

VAT Calculation

KES

Enter the price before VAT is added

?? VAT Quick Reference

Standard Rate (16%)

  • � Most goods and services
  • � Retail sales
  • � Professional services
  • � Telecommunications
  • � Restaurants & hotels

Zero-Rated (0%)

  • � Exported goods & services
  • � International transport
  • � Supplies to EPZ/SEZ
  • � Diplomatic supplies
  • � Some agricultural products

Exempt (No VAT)

  • � Financial services
  • � Insurance products
  • � Education services
  • � Healthcare services
  • � Residential property rental

?? Important Deadlines

VAT Return Filing:20th of every month
VAT Payment:20th of every month
Registration threshold:KES 5M annual

??? Withholding VAT

Government bodies & large institutions withhold 6% of VAT from suppliers

Standard rate: 2% on taxable supplies (since Nov 2019)

eTIMS Required

All VAT-registered businesses must use eTIMS (Electronic Tax Invoice Management System) for invoicing since 2024.

Kenya VAT Rates 2025 - Standard, Zero-Rated & Exempt Goods

Comprehensive guide to VAT rates in Kenya. Understand which products are taxed at 16%, which are zero-rated (0%), and which are completely VAT-exempt. Updated with Finance Act 2024 amendments. If you're importing goods, also check our import duty calculator for customs fees, and use the turnover tax calculator for small businesses below VAT threshold.

CategoryVAT RateExamples of Products/ServicesCan You Claim Input VAT?Notes
Standard Rate16%Electronics, clothing, furniture, professional services, restaurants, construction materials, vehiclesYESMost goods and services fall under this category
Zero-Rated0%Exports, international transport, agricultural inputs (fertilizers, seeds), medical supplies, solar equipmentYESYou charge 0% VAT but can still reclaim input VAT - best for exporters!
ExemptExemptUnprocessed agricultural produce, financial services (bank interest), insurance, education services, residential rent, medical servicesNONo VAT charged, but you CANNOT claim input VAT - becomes a cost to your business

?? Key Difference: Zero-Rated vs Exempt

? Zero-Rated (0%) - BETTER for Business:

  • You charge customers 0% VAT
  • You CAN reclaim VAT paid on inputs
  • Example: Exporter pays KES 16K VAT on materials, charges customer 0%, gets KES 16K refund from KRA
  • Result: No VAT burden

? Exempt - WORSE for Business:

  • You don't charge customers VAT
  • You CANNOT reclaim VAT paid on inputs
  • Example: Farmer pays KES 16K VAT on supplies, sells produce exempt, gets KES 0 refund
  • Result: VAT becomes a cost (reduces profit)

VAT Calculation Examples by Industry Kenya 2025

Real-world VAT calculations for different businesses. See how VAT works in practice for retail, services, manufacturing, and more.

1

?? Electronics Retail Store (Standard Rate 16%)

Scenario: You sell a laptop for KES 60,000 (VAT exclusive price)

� Laptop Price (VAT Exclusive): KES 60,000

� VAT at 16%: KES 9,600

� Total Price Customer Pays: KES 69,600

Invoice shows: "Laptop - KES 60,000 + VAT KES 9,600 = Total KES 69,600"

? What You Owe KRA: KES 9,600 collected VAT (minus any input VAT you paid on business expenses)

2

?? Law Firm / Professional Services (16%)

Scenario: You charge KES 200,000 for legal services (VAT exclusive)

� Legal Fees (VAT Exclusive): KES 200,000

� VAT at 16%: KES 32,000

� Total Invoice to Client: KES 232,000

You can claim back VAT paid on office supplies, rent (if commercial), utilities

? If you paid KES 12,000 input VAT this month, you remit: KES 32,000 - KES 12,000 = KES 20,000 to KRA

3

??? Construction Contractor (16%)

Scenario: Building contract worth KES 5,000,000 (VAT exclusive)

Output VAT (What you charge):

� Contract Value: KES 5,000,000

� VAT at 16%: KES 800,000

� Total to Client: KES 5,800,000

Input VAT (What you paid):

� Cement, steel, tiles: KES 2M + VAT KES 320,000

� Labor (exempt - no VAT)

� Equipment rental: KES 500K + VAT KES 80,000

� Total Input VAT: KES 400,000

? You remit to KRA: KES 800,000 - KES 400,000 = KES 400,000

4

??? Restaurant / Hotel (16%)

Scenario: Customer bill KES 5,000 (VAT inclusive - most restaurants show final price)

Method 1 - If price is VAT inclusive:

� Total Bill: KES 5,000

� VAT Exclusive Amount: KES 5,000 � 1.16 = KES 4,310.34

� VAT at 16%: KES 689.66

Receipt shows: "Total: KES 5,000 (includes VAT KES 689.66)"

Common Issue: Some restaurants show prices VAT-exclusive (KES 4,310) then add VAT at checkout (total KES 5,000). Both methods are legal if clearly stated.

5

?? Exporter (Zero-Rated 0%)

Scenario: You export coffee worth KES 10,000,000 to Europe

Output VAT (What you charge):

� Export Value: KES 10,000,000

� VAT at 0%: KES 0 (zero-rated)

Input VAT (What you paid):

� Packaging materials: KES 500K + VAT KES 80,000

� Transport: KES 300K + VAT KES 48,000

� Total Input VAT: KES 128,000

? You get a REFUND of KES 128,000 from KRA! (Output VAT 0 - Input VAT 128K = -128K refund)

This is why zero-rating is better than exemption - you reclaim all input VAT

7 Costly VAT Mistakes Kenyan Businesses Make

Avoid these expensive errors that trigger KRA audits, penalties, and cash flow problems.

? 1. Not Registering for VAT When You Hit KES 5M Turnover

The Law: You MUST register for VAT within 30 days once your annual turnover exceeds KES 5 million. Businesses below KES 5M can opt for turnover tax instead.

The Penalty: KRA penalty of KES 10,000 + 5% of tax due per month (max 100%) + potential prosecution

Example: Your turnover is KES 7M annually. You don't register. KRA audits you, calculates you owe KES 200K VAT. Penalty = KES 10K + up to KES 200K = KES 210K total!

? Solution: Track your sales monthly using our profit margin calculator. Register immediately when you hit KES 416,667/month (KES 5M � 12) average.

? 2. Missing eTIMS Invoicing Deadlines (2025 Requirement!)

What is eTIMS: Electronic Tax Invoice Management System - mandatory for ALL VAT-registered businesses from January 2024.

The Requirement: Every sale MUST generate an eTIMS invoice in real-time. KRA sees all your sales instantly.

The Penalty: KES 1 million fine or 2 years imprisonment for non-compliance (Tax Procedures Act Section 42A)

? Solution: Get eTIMS-compliant POS/invoicing system. Options: Quickbooks (KES 3K/mo), Zoho Books (KES 2K/mo), or free KRA portal.

? 3. Claiming VAT on Expenses Without Proper Tax Invoices

The Rule: You can ONLY claim input VAT if you have a valid tax invoice with supplier's PIN, VAT amount clearly shown.

What Doesn't Qualify: Receipts saying just "Total KES 5,000" with no VAT breakdown, handwritten notes, supplier not VAT-registered

Example: You spend KES 100K on supplies. Half (KES 50K) are receipts without proper tax invoices. You claim KES 16K VAT. KRA audit disallows KES 8K. You must pay back KES 8K + penalties

? Solution: Always request proper tax invoices. Check supplier is VAT-registered on KRA iTax portal before claiming.

? 4. Late VAT Return Filing (20th of Every Month!)

The Deadline: File AND pay VAT by 20th of following month. January VAT due by 20th February.

The Penalty: 5% of tax due OR KES 10,000 (whichever is higher) for late filing + 1% per month on unpaid tax

Example: You owe KES 50K VAT. You file on 25th (5 days late). Penalty = 5% of KES 50K = KES 2,500 late filing fee + interest

? Solution: Set calendar reminder for 15th of month. File even if you owe zero (Nil return) to avoid penalties.

? 5. Using VAT Collected to Pay Other Business Expenses

The Mistake: Treating VAT collected from customers as "revenue" and spending it on salaries, rent, etc.

Why It's Dangerous: VAT is KRA's money, not yours. When filing date (20th) arrives, you don't have funds to pay.

Real Case: Restaurant collects KES 200K VAT in January. Owner uses it for rent & salaries. 20th Feb comes - no money. Borrows at 15% interest to pay KRA. Loses KES 30K in interest over year!

? Solution: Open separate "VAT Trust Account." Transfer 16% of each sale immediately. Never touch it except to pay KRA.

? 6. Claiming VAT on Exempt Purchases (Agriculture, Education, etc.)

The Error: Assuming all business expenses qualify for VAT refund. Some are exempt by law.

Cannot Claim VAT On:

  • Bank interest and loan charges (financial services are exempt)
  • Insurance premiums (exempt)
  • Residential rent (exempt - but commercial rent has VAT)
  • Unprocessed food (maize, beans - exempt, but processed food taxed)
  • Education/training fees (exempt)

? Solution: Learn exempt vs taxable supplies. When in doubt, check VAT Act First Schedule (exempt list).

? 7. Not Keeping Records for 5 Years (KRA Audit Trap)

The Law: Tax Procedures Act requires keeping ALL tax records for minimum 5 years.

What Records: Sales invoices, purchase invoices, bank statements, VAT returns, stock records, eTIMS reports

Audit Scenario: KRA audits your 2020 VAT (within 5-year window). You can't find purchase invoices proving KES 500K input VAT claimed. KRA disallows it. You owe KES 80K + penalties!

? Solution: Use cloud accounting software (auto-saves everything). Physical documents = scan and backup to Google Drive/Dropbox monthly.

Complete eTIMS Guide Kenya 2025 - Electronic Tax Invoice Management System

Everything you need to know about eTIMS (formerly TIMS). Mandatory for all VAT-registered businesses since January 2024.

?? What is eTIMS?

eTIMS is KRA's digital system that transmits ALL your sales invoices to KRA servers in real-time. Every time you make a sale, eTIMS sends the invoice details to KRA instantly - no more manual VAT return filing with risk of under-reporting.

Key Features: Real-time invoice transmission, QR code verification, automatic VAT return generation, reduced tax evasion, faster VAT refunds.

?? Who MUST Use eTIMS?

  • ? Mandatory For: All VAT-registered taxpayers (turnover above KES 5M/year)
  • ? Also Required: Companies providing taxable services to government (even if below KES 5M)
  • ? Voluntary: Non-VAT businesses can register voluntarily for credibility
  • ? Exempt: Individuals providing only exempt supplies (e.g., pure farmers selling raw produce)

?? How to Register for eTIMS (Step-by-Step)

  1. Login to iTax: Visit itax.kra.go.ke with your KRA PIN
  2. Navigate: Returns & Payments ? eTIMS ? Request Invoice Serial Number
  3. Fill Details: Business name, location, number of devices (POS machines/computers)
  4. Get Serial Number: KRA assigns unique Control Unit (CU) serial number (e.g., CU-123456)
  5. Download eTIMS Software:
    • � Desktop version: For Windows/Mac POS
    • � Mobile app: For Android/iOS smartphones
    • � API integration: For existing accounting systems (Quickbooks, Xero, etc.)
  6. Configure: Enter CU serial number, test by issuing sample invoice
  7. Go Live: Start issuing eTIMS invoices for all sales from activation date

Cost: FREE for basic eTIMS. Hardware (POS machine) costs KES 15,000-50,000 if you don't have one.

?? How eTIMS Works (Invoice Flow)

Step 1: Customer buys goods/services for KES 10,000 + VAT

Step 2: You issue invoice through eTIMS device ? Invoice details sent to KRA instantly

Step 3: eTIMS generates QR code on invoice ? Customer can scan to verify it's genuine

Step 4: At month-end, KRA has ALL your sales data ? Auto-fills VAT return for you

Step 5: You review auto-filled return, add any corrections, submit by 20th

Sample eTIMS Invoice Must Include:

  • Business PIN & eTIMS serial number
  • Customer details (name, PIN if registered)
  • Item description, quantity, unit price
  • VAT breakdown (exclusive amount + 16% VAT)
  • QR code for verification
  • Date & time (auto-stamped, can't backdate!)

? Benefits of eTIMS for Your Business

  • � Faster VAT Refunds: KRA sees your records are genuine ? refunds processed in 30 days vs 6+ months
  • � Reduced Audits: Real-time compliance = less likely to be audited
  • � Credibility: QR codes prove invoices are real ? banks trust you more for loans
  • � Auto VAT Returns: No manual entry ? fewer errors
  • � Inventory Tracking: eTIMS tracks stock automatically
  • � Customer Trust: Professional invoices with QR codes
  • � Government Contracts: Mandatory for suppliers to govt
  • � Legal Compliance: Avoid KES 1M fine

?? Penalties for Non-Compliance

  • � Not Using eTIMS: KES 1,000,000 fine or 2 years imprisonment (Tax Procedures Act Sec 42A)
  • � Issuing Fake Invoices: KES 2,000,000 fine or 3 years jail
  • � Backdating Invoices: Audit trigger + penalties for tax evasion
  • � Lost Internet/No Sync: Must submit manual return within 24 hours + explain to KRA

How to Use the VAT Calculator

1

Choose Operation

Select whether to add VAT to a price or remove VAT from a total

2

Enter Amount

Input the amount in KES (before or after VAT depending on operation)

3

Select VAT Rate

Choose 16% (standard), 0% (zero-rated), or enter custom rate

4

View Results

See VAT amount, exclusive price, inclusive price, and formula breakdown

?? Pro Tip: For businesses, use "Add VAT" to calculate customer prices. Use "Remove VAT" to find the base amount for accounting and KRA reporting.

Frequently Asked Questions About VAT in Kenya

What is VAT and how does it work in Kenya??

Value Added Tax (VAT) is an indirect consumption tax charged on the supply of taxable goods and services in Kenya. It's collected at each stage of production and distribution but ultimately paid by the final consumer.

How VAT works in Kenya:

  • Businesses charge VAT on sales (Output VAT)
  • Businesses pay VAT on purchases (Input VAT)
  • Net VAT = Output VAT - Input VAT is remitted to KRA
  • Returns filed monthly by 20th via iTax portal

Source: KRA - Value Added Tax

What is the current VAT rate in Kenya for 2025??

The VAT rates in Kenya for 2025 are:

RateDescription
16%Standard rate - applies to most goods and services
0%Zero-rated supplies - exports, international transport, certain essential goods
ExemptNo VAT - financial services, insurance, education, healthcare

Withholding VAT: 2% of taxable supplies (charged by government entities and approved withholding VAT agents)

Source: KRA Official VAT Rates 2025

Who must register for VAT in Kenya??

Mandatory VAT Registration:

  • Turnover threshold: Businesses with annual taxable turnover exceeding KES 5,000,000 must register within 30 days
  • Before starting business: If you expect to exceed KES 5M in the next 12 months
  • Importers: Some businesses may need to register regardless of turnover. Use our import duty calculator for import costs.

Voluntary VAT Registration:

Businesses below the threshold can voluntarily register for VAT if they wish to claim input VAT on purchases. Alternatively, small businesses can opt for the simpler 3% turnover tax regime.

Registration Process:

  1. Log in to iTax portal (itax.kra.go.ke)
  2. Apply for VAT registration
  3. Submit required documents
  4. Receive VAT PIN certificate

Source: KRA Registration Requirements

What goods and services are zero-rated (0% VAT)??

Zero-rated supplies attract 0% VAT but businesses can still claim input VAT. Common zero-rated items include:

Exports & International:

  • Exported goods and services
  • International transport services
  • Goods supplied to EPZ/SEZ
  • Diplomatic and privileged persons' supplies

Essential Goods:

  • Certain agricultural products
  • Medical supplies (as per Second Schedule)
  • Liquefied petroleum gas (LPG)
  • Solar and electrical accumulators

Important: Zero-rated is different from exempt. Zero-rated suppliers can claim input VAT, while exempt suppliers cannot.

Source: VAT Act 2013 - Second Schedule

What goods and services are exempt from VAT??

Exempt supplies have no VAT charged and businesses cannot claim input VAT on related purchases:

  • Financial services: Banking, lending, credit facilities
  • Insurance services: Life, medical, general insurance - see our insurance calculator
  • Education: Tuition fees, examination fees (registered institutions)
  • Healthcare: Medical services, hospital care
  • Residential property: Rental of residential properties - landlords use our rental tax calculator
  • Transport: Passenger transport by road (14+ seat vehicles)
  • Betting & lottery: Gaming and betting services

Note: Exempt businesses cannot claim input VAT, making some costs higher than for VAT-registered businesses.

Source: VAT Act 2013 - First Schedule (Exempt Supplies)

When are VAT returns due and how do I file??

VAT Filing Deadlines:

  • Monthly returns: Due on or before the 20th of the following month
  • Example: January VAT return must be filed by February 20th
  • Payment: Also due by 20th of the following month

How to File VAT Returns:

  1. Log in to iTax portal
  2. Navigate to Returns ? File Returns ? VAT
  3. Select the tax period (month/year)
  4. Enter sales (output VAT) and purchases (input VAT)
  5. System calculates net VAT payable/refundable
  6. Submit the return
  7. Make payment via bank, M-Pesa, or iPay if VAT is due

?? Late Filing Penalty: KES 10,000 or 5% of tax due (whichever is higher) for late filing. Late payment attracts 1% interest per month.

Source: iTax Portal

What is eTIMS and do I need it for VAT??

eTIMS (Electronic Tax Invoice Management System) is a digital system by KRA for real-time transmission of sales and purchase invoices.

Who Must Use eTIMS:

  • All VAT-registered taxpayers (mandatory as of 2024)
  • Non-VAT businesses above turnover threshold
  • Businesses issuing tax invoices

eTIMS Benefits:

  • ? Real-time invoice transmission to KRA
  • ? Automatic VAT return pre-population
  • ? Reduced compliance burden
  • ? Digital record keeping
  • ? Input VAT validation

eTIMS Devices:

  • Desktop application (free download)
  • eTIMS server (for ERP integration)
  • Virtual Sales Control Unit (VSCU)

Download eTIMS: KRA eTIMS Portal

How do I calculate VAT manually??

To Add VAT (16%) to a price:

VAT Amount = Price � 0.16

Total Price = Price � 1.16

Example: KES 10,000 + 16% VAT = KES 10,000 � 1.16 = KES 11,600

To Remove VAT (16%) from total price:

Price (excl VAT) = Total � 1.16

VAT Amount = Total - (Total � 1.16)

Example: KES 11,600 � 1.16 = KES 10,000 (exclusive price)

?? Quick Tip: Use our calculator above for instant accurate calculations, especially for large amounts or multiple items!

What is Withholding VAT and who deducts it??

Withholding VAT is a mechanism where certain entities deduct a portion of VAT at source when making payments to suppliers.

Withholding VAT Rate: 2% of the taxable value (effective since November 2019)

Who Withholds VAT:

  • Government ministries, departments, and agencies
  • Public universities and state corporations
  • County governments
  • Appointed withholding VAT agents (large companies)

How It Works:

  1. Supplier issues invoice with 16% VAT = KES 16,000 on KES 100,000 supply
  2. Government entity withholds 2% = KES 2,000
  3. Supplier receives KES 114,000 (instead of KES 116,000)
  4. Supplier claims withheld KES 2,000 as credit when filing VAT return

Note: Withholding VAT certificates are issued via iTax and must be claimed in VAT returns.

Source: KRA Withholding VAT Guidelines

Where can I get official VAT information and support??

Official KRA Resources:

  • ??
    KRA Website: kra.go.ke/value-added-tax

    Complete VAT information, rates, and guidelines

  • ??
    iTax Portal: itax.kra.go.ke

    File returns, make payments, check compliance

  • ??
    KRA Call Centre: 0711 099 999 / 0711 099 100

    Monday - Friday: 8:00 AM - 5:00 PM

  • ??
    Email Support: callcentre@kra.go.ke

    For VAT queries and support

  • ??
    eTIMS Support: kra.go.ke/etims

    Download eTIMS software and user guides

?? Tip: Visit your nearest KRA Taxpayer Service Centre for in-person assistance with VAT registration and compliance.

?? VAT Examples by Industry: Real Kenya Business Scenarios 2025

See exactly how 16% VAT applies across different industries and transaction sizes in Kenya. All examples use current 2025 rates.

Retail & Supermarkets

Small Shop (Kiosk)

Daily sales:KES 5,000
VAT collected:KES 690
Monthly VAT:KES 20,690
Annual turnover:~KES 1.8M

?? Below KES 5M threshold - VAT registration optional

Medium Supermarket

Daily sales:KES 150,000
VAT collected:KES 20,690
Monthly VAT:KES 620,690
Annual turnover:~KES 54M

? VAT registration mandatory

Large Supermarket Chain

Daily sales (per store):KES 500,000
VAT collected:KES 68,966
Monthly VAT (1 store):KES 2,068,966
10 stores total:~KES 20.7M/month

Input VAT claimable on stock purchases

Manufacturing & Production

Small Bakery

Monthly sales:KES 300,000
Output VAT:KES 41,379
Raw materials bought:KES 150,000
Input VAT claimed:-KES 20,690
Net VAT due:KES 20,689

Furniture Factory

Monthly sales:KES 2,000,000
Output VAT:KES 275,862
Materials + machinery:KES 1,200,000
Input VAT claimed:-KES 165,517
Net VAT due:KES 110,345

Beverage Manufacturer

Monthly sales:KES 50,000,000
Output VAT:KES 6,896,552
Production costs:KES 30,000,000
Input VAT claimed:-KES 4,137,931
Net VAT due:KES 2,758,621

Professional Services

Consultancy Firm

Project invoice:KES 500,000
VAT charged (16%):KES 80,000
Total invoice:KES 580,000

Client pays KES 580,000. You remit KES 80,000 to KRA

IT Services Company

Monthly service fees:KES 3,000,000
Output VAT:KES 413,793
Office expenses:KES 500,000
Input VAT:-KES 68,966
Net VAT:KES 344,827

Accounting Firm

Monthly billings:KES 1,500,000
VAT charged:KES 206,897
Office + software:KES 200,000
Input VAT:-KES 27,586
Net VAT:KES 179,311

Hospitality & Tourism

Restaurant (Nairobi)

Daily revenue:KES 50,000
Daily VAT:KES 6,897
Monthly VAT:KES 206,897
Food supplies input VAT:~KES 100,000/mo

Net VAT: ~KES 106,897/month

Mid-Size Hotel

Monthly bookings:KES 4,000,000
Output VAT:KES 551,724
Operations costs:KES 1,500,000
Input VAT:-KES 206,897
Net VAT:KES 344,827

Safari Lodge (Maasai Mara)

Peak season monthly:KES 15,000,000
Output VAT:KES 2,068,966
Operating expenses:KES 6,000,000
Input VAT:-KES 827,586
Net VAT:KES 1,241,380

Construction & Real Estate

Building Materials Supplier

Monthly sales:KES 8,000,000
Output VAT:KES 1,103,448
Stock purchases:KES 5,000,000
Input VAT:-KES 689,655
Net VAT:KES 413,793

Construction Contractor

Project value:KES 20,000,000
VAT charged:KES 2,758,621
Materials + equipment:KES 12,000,000
Input VAT:-KES 1,655,172
Net VAT:KES 1,103,449

Property Developer

Commercial property sale:KES 80,000,000
VAT on sale:KES 11,034,483
Construction input VAT:~KES 6M claimable
Net VAT:~KES 5,034,483

?? Residential rental exempt from VAT

Import & Export Businesses

Electronics Importer

Goods imported (CIF):KES 5,000,000
Import VAT paid:KES 689,655
Local sales:KES 7,000,000
Output VAT:KES 965,517
Net VAT (refund):-KES 275,862

Import VAT claimable as input

Coffee Exporter

Export sales:KES 10,000,000
VAT charged:0% (Zero-rated)
Local purchases:KES 6,000,000
Input VAT claimed:-KES 827,586
VAT refund due:KES 827,586

? Exports are zero-rated, input VAT refundable

Vehicle Importer

Car import (after duty):KES 3,000,000
Import VAT paid:KES 413,793
Sale price in Kenya:KES 4,500,000
Output VAT:KES 620,690
Net VAT:KES 206,897

?? Data Note: All scenarios use 16% VAT rate (standard rate for 2025). Examples show typical transaction patterns across Kenya business sectors from SMEs to large corporates.

??? VAT Registration & Compliance by Business Location in Kenya

Registration requirements and compliance support vary by region. Here's what businesses need to know across Kenya.

Nairobi & Major Cities

KRA Service Centers: Multiple locations (Times Tower, Westlands, Upperhill)

eTIMS Support: Full technical support available

Typical Businesses:

  • Corporate offices - KES 50M+ annual turnover
  • Retail chains - KES 10M-100M turnover
  • Professional services - KES 5M-50M
  • Restaurants & hospitality - KES 8M-200M

? Fast registration (2-3 days with iTax)

Mombasa & Coast Region

KRA Centers: Mombasa (Port, Town), Malindi, Kilifi

Key Industries:

  • Import/export businesses - High turnover
  • Tourism & hotels - Seasonal VAT variations
  • Clearing & forwarding - KES 20M-500M
  • Shipping services - Zero-rated exports

Note: Import VAT paid at port, claimable on returns

Kisumu, Nakuru, Eldoret

Regional Centers: Growing KRA presence

Common VAT Businesses:

  • Agricultural suppliers - KES 6M-30M
  • Manufacturing - KES 15M-100M
  • Wholesale distributors - KES 10M-80M
  • Transport & logistics - KES 8M-50M

Many agricultural products zero-rated

Rural & Small Town Businesses

Challenges: Limited KRA physical access

Solution: iTax online registration & filing

Typical Scenarios:

  • Hardware stores - KES 4M-15M (often below threshold)
  • Agro-dealers - KES 5M-20M turnover
  • Small manufacturers - KES 3M-10M
  • Transport businesses - KES 5M-25M

Many below KES 5M threshold - optional registration

?? Smart VAT Management for Kenyan Businesses

Stay Below Threshold Strategically:

If turnover near KES 5M, consider splitting business units to delay VAT registration and reduce admin burden.

Voluntary Registration Benefits:

Register even below KES 5M if you deal with VAT-registered clients (B2B) - they can claim your input VAT, making you more competitive.

Small Business Below KES 5M Turnover?

If your annual turnover is below KES 5 million, you may qualify for the simpler turnover tax regime:

VAT rates updated for 2025 - Standard rate remains at 16%

File your VAT returns via iTax portal by 20th of every month. All calculations verified with KNBS 2025 Economic Survey business taxation data.

?? Official Sources & References:

VAT rates verified from KRA official sources and Finance Act 2025. Business sector data from KNBS 2025 Economic Survey. Last updated: January 2025

Important Disclaimer

General Information Only: This calculator provides estimates based on publicly available information and standard rates. Results are for informational and educational purposes only and should not be considered as professional financial, legal, or tax advice.

Accuracy and Updates: While we strive to maintain accurate and up-to-date information using official sources including Kenya Revenue Authority (KRA), National Social Security Fund (NSSF), Social Health Insurance Fund (SHIF), and other relevant government agencies, rates and regulations may change. Always verify current rates with official sources.

Seek Professional Advice: For specific tax planning, salary negotiations, financial decisions, or legal matters, please consult with qualified professionals such as certified accountants, tax advisors, financial planners, or legal practitioners who can consider your individual circumstances.

No Liability: Top Calculator and its operators accept no liability for any loss, damage, or inconvenience arising from the use of this calculator or reliance on its results. Users are responsible for verifying all calculations and information with official sources before making financial decisions.

Official Sources: For authoritative information, please refer to:

Last updated: January 2025. This disclaimer applies to all calculators on Top Calculator.