What is the VAT rate in Kenya?

The standard VAT rate is 16%. The former 8% rate on fuel was removed in 2023, so no 8% rate currently exists. Confirm the treatment of your supplies with the KRA.

eTIMS is the KRA's electronic Tax Invoice Management System. Tax invoices must be generated and transmitted through it, and the data increasingly pre-fills your VAT return.

When must I register for VAT in Kenya?

Registration is mandatory once taxable turnover reaches KES 5,000,000 in any 12-month period. Non-resident digital suppliers must register regardless of turnover.

Tax & VAT

VAT & eTIMS in Kenya (the VAT3 Return)

How VAT works in Kenya — the 16% rate, when you must register, filing the VAT3 on iTax, and the mandatory eTIMS electronic tax invoice system.

Published 5 July 2026 · 6 min read

The short answer

Kenya charges 16% VAT, administered by the Kenya Revenue Authority (KRA).
Registration is mandatory once taxable turnover reaches KES 5,000,000 in any 12 months.
VAT is filed monthly on the VAT3 return through iTax, generally due by the 20th of the following month.
eTIMS (the electronic Tax Invoice Management System) is mandatory — invoices must be transmitted through it.
This is general information — confirm current rates and rules with the KRA or a qualified tax professional.

How VAT works in Kenya

Value Added Tax in Kenya is charged at a standard rate of 16% on most goods and services, with some supplies zero-rated (such as exports and certain essentials) or exempt. It is administered by the Kenya Revenue Authority (KRA).

Note that the former 8% rate on petroleum products was removed in 2023, so there is no 8% VAT rate today. Registered businesses add 16% VAT, reclaim input VAT on purchases, and pay the difference to the KRA.

eTIMS: electronic tax invoices

Kenya requires tax invoices to be generated and transmitted through eTIMS, the electronic Tax Invoice Management System that succeeded TIMS. In practice this means your invoicing system sends invoice data to the KRA, which increasingly uses it to pre-fill your VAT return. Using compliant invoicing software is the simplest way to stay on the right side of the rules.

Filing the VAT3, step by step

1
Issue eTIMS invoices as you trade
Make sure every sale is invoiced through eTIMS so your output VAT is captured accurately and your buyers can claim their input VAT.
2
Reconcile output and input VAT
Total the VAT you charged and the VAT you paid on purchases for the month, keeping valid invoices for anything you claim.
3
File the VAT3 on iTax
Log in to iTax, open the VAT3 return, and confirm or complete the figures — the KRA has rolled out an auto-populated return pre-filled from eTIMS data. Submit before the deadline.
4
Pay by the 20th
Pay any VAT due by the 20th of the month following the tax period. File on time even for a nil return to avoid penalties.

How Tallium helps

Tallium applies 16% VAT on every sale and expense, keeps your books in step, and builds a VAT3-ready summary — and is designed to work with eTIMS electronic invoicing requirements. Always confirm current rules with the KRA or a qualified tax professional before you file.

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Tallium keeps your accounting, tax and invoicing ready for your country's rules as you trade — from $79/month per shop.

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Kenya VAT calculator →Accounting software for retail shops in Kenya →Pricing →

This article is general information, not tax or legal advice. Always confirm current rules with your country's tax authority or a qualified adviser.