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Value Added Tax in Kenya

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Value Added Tax in Kenya
Registration for VAT
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What is Sales Tax / VAT


This is commonly known as Sales Tax, but in Kenya this tax is known us Value Added Tax (VAT). This is tax charged on sale of goods and services both inside and outside Kenya. It also include supply of imported taxable services by a non-resident in Kenya.

 

Collection and Payment


Value Added Tax is charged to customers on importation or supply of goods and services. The registered tax payers collects that tax on behalf of the government and accounts for the VAT collected by them. The burden of VAT is borne by the customers and not the supplier. In other words the money collected is not business profit but should be treated as a liability in the books of the supplier.

Input VAT or purchases VAT should be claimed before remitting the balance to the tax authority. The amount of VAT output or VAT on sales should be reduced by input VAT to determine the amount payable.

 

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