Tax Bites KE

05/05/2026

🚨 Mitumba traders — the Finance Bill 2026 has something you need to read.
The government is proposing a brand new 5% tax on the customs value of all imported second-hand clothing and footwear. And here's the critical part — it's collected at importation. Before the bale even clears the port.
What does that mean for you?
✅ Importers face higher upfront costs
✅ Wholesalers pass it down the chain
✅ Retailers squeeze margins or raise prices
✅ Customers pay more at the end
Every layer of the mitumba supply chain — from the big importer to the trader in Eastleigh or Gikomba — will feel this.
The good news? This is not law yet. The Bill is open for public participation this May, which means Kenyans still have a chance to engage before it's passed.
Stay informed. Follow Tax Bites KE for plain-language breakdowns of everything in the Finance Bill 2026 that affects your business.
💬 Drop a comment — how would this affect your business?

24/04/2026

🚨 KRA is watching your Paybill and Till Number.
Small traders who keep switching mobile money paybills and till numbers to dodge taxes are now in KRA's crosshairs.
This isn't a rumour — it's an active crackdown.
Here's what KRA already knows:
✅ Your Mpesa transaction volumes
✅ Your registered business details
✅ When your numbers keep changing
Switching numbers doesn't erase your tax obligation. It just flags you as a risk.
If your business collects money via Paybill or Till — you have a tax footprint. The question is whether it's clean or not.
📌 Get ahead of KRA before KRA gets to you.
DM us for a confidential compliance check.

21/04/2026

KRA is no longer waiting for end of year to catch up with your business.

eTIMS has fundamentally changed how tax audits work in Kenya — and as a business owner, it's important to understand what's coming.

Here's what is changing:

✅ Predictive Audits — KRA will soon be able to detect potential non-compliance before it even happens. If your margins suddenly look different from your industry average, the system can flag you automatically.

✅ 360° Tax Visibility — eTIMS is being integrated with iTax, Customs, Banking systems, and PAYE. Practically speaking, your entire financial footprint will be visible from one system.

✅ Continuous Audits — Audits will no longer be a once-in-a-while event. We are moving towards daily and weekly system checks with instant discrepancy notifications. Businesses will effectively be under review at all times.

✅ Automated Assessments — System-generated assessments are increasing while physical audit visits are reducing. And when disputes arise, the conversation will shift to data integrity — not just your word against theirs.

The takeaway for business owners is straightforward — your records need to be accurate and eTIMS-compliant consistently, not just during filing season.

Have questions about where your business stands? DM us or drop a comment below — tuongee.

20/04/2026

Understanding VAT: Input vs Output — and why the difference matters for your business.
If your business is VAT-registered, you are required to charge 16% VAT on your taxable sales. This is called Output VAT, and it is collected on behalf of KRA.
What many SME owners overlook, however, is that the VAT paid on business purchases — stock, equipment, and services from VAT-registered suppliers — is also recoverable, provided those purchases relate to taxable supplies. This is called Input VAT.
Under the VAT Act, you do not remit all the VAT you collect. You remit the difference:
Output VAT − Input VAT = VAT Payable to KRA
If your Input VAT exceeds your Output VAT in a given period, you are entitled to carry forward the excess as a credit to the following period.
It is worth noting that Input VAT claims must be made within 6 months of the date on the tax invoice. Businesses that do not track their purchase receipts within this window may end up paying more VAT than they are legally required to.
Proper VAT accounting requires maintaining valid tax invoices from registered suppliers, filing accurate VAT returns on iTax by the 20th of each month, and reconciling your VAT position regularly.
If you are unsure whether your VAT returns are accurate, or if you have unclaimed Input VAT credits, we are happy to review your position and advise accordingly.
📩 Reach out via DM or drop a comment below — we will get back to you.

18/04/2026

📢 IMPORTANT FOR KENYAN BUSINESS OWNERS
KRA cannot freeze your bank account "out of nowhere."
A recent High Court ruling confirmed what the law already said — KRA must follow a specific process before touching your bank account:
✅ Step 1: Issue a valid tax assessment
✅ Step 2: Serve you a formal demand notice
✅ Step 3: Only then can they issue an agency notice to your bank
The court quashed agency notices issued to a company's banks because KRA had skipped straight to enforcement — no valid assessment, no demand served. The court ruled that was unlawful.
If your account has ever been frozen without you receiving a prior assessment and demand, that action may be legally challengeable.
Know your rights. Protect your business.
At Tax Bites KE, we help SMEs navigate KRA compliance and enforcement — so you're never caught off guard.
📩 DM us or drop a comment if you have questions.

10/04/2026

Most businesses think VAT starts when filing.
❌ Wrong.
Your VAT is already calculated by the system.
The real question is: Is it correct?
📩 Let’s fix it before KRA flags it.

Check out Tax Bites Ke’s post.

10/04/2026

🟨 VAT Compliance = System Alignment
✔ eTIMS invoices
✔ Supplier compliance
✔ Accurate reporting

06/04/2026

❌ Why Your Tax Compliance Certificate (TCC) Is Being Rejected
Even when:
✔ No tax is due
✔ Returns are filed
You can still be declined because of:
🚫 Not registered on eTIMS
🚫 Missing invoices
🚫 System inconsistencies
📌 Compliance today = FULL system compliance
💬 Need help fixing this? DM me.

06/04/2026

06/04/2026

Turnover Tax (TOT) in anutshell

03/04/2026

🚨 Tax Audits Are No Longer Random

KRA is now using data analytics to detect inconsistencies across the following:
✔ VAT returns
✔ PAYE filings
✔ Supplier declarations

Meaning?
It’s no longer about filing… It's about being audit-ready.

📌 One mismatch = red flag

💬 Is your business audit-ready today?