Kenya Revenue Authority has given value-added tax (VAT) taxpayers up to 31 July 2022 to start using new electronic tax invoicing machines. The new tax registers would replace the current Electronic Tax Register (ETR) whose use started in 2005. All registered VAT taxpayers must use the new tax register to send their tax data to KRA on real time.
Kenya Revenue Authority has approved nine new firms to start selling new electronic tax registers. The nine firms join seven firms the authority approved in October 2021. KRA has now approved 16 electronic tax registers suppliers.
The nine new electronic tax register resellers would sell machines made in Bulgaria, China, Malaysia, and Poland. Four firms are getting their machines from China, two from Poland, two from Bulgaria and one from Malaysia.
Kenya Revenue Authority on 5 July 2022 reminded VAT registered taxpayers to obey the 31 July 2022 deadline. All VAT registered taxpayers must move from the current Electronic Tax Registers to the Tax Invoice Management System (TIMS) before 1 August 2022.
The authority said all VAT registered taxpayers must have the new Electronic Tax Registers by 31 July 2022. “And generate validated and electronically transmitted tax invoices in compliance with the Value Added Tax (Electronic Tax Invoice) Regulations, 2020,” it said.
KRA said it will only accept electronically transmitted invoices from manufacturers wanting to claim input tax.
9 newly approved resellers of electronic tax registers
Advatech Office Supplies limited. The firm is selling electronic tax register Types A, B and C made by two manufacturers from Bulgaria. Tremol Limited and Datecs Limited make the machines.
Computech limited. KRA has approved the firm to sell electronic tax register Types A, B and C. Comp S.A. from Poland makes the tax registers.
Copy Cat limited. The firm is selling Types A, B and C. Comp S.A. makes the electronic tax registers in Poland.
Dejavu Technologies limited. The firm is selling electronic tax register Types A and D. Xiamen Pinnacle Electrical Company limited from China makes the machines.
Ezeemoney limited. The firm is selling only Type A. The electronic tax register is made by P Plus SDN BHD of Malaysia.
Lynx Distribution limited. The firm is selling electronic tax register Types A and D. The machines are made by Xiamen Datamega Technology Company limited (Type A) and Xiamen Pinnacle Electrical Company limited (Type A and D). The manufacturers are from China.
Matrix Telematics limited. It sells electronic tax register Types A and D. The machines come from Shenzhen Xingode Technology Company from China.
Peckerwoods limited. It sells Types A and D. Xiamen Pinnacle Electrical Company limited (Type A) and Shenzhen Xingode Company (Types A and D) make the machines in China.
Total Solutions limited. It’s selling electronic tax register Types A, B and C. Tremol limited of Bulgaria makes the machines.
How are these types of electronic tax registers different?
Kenya Revenue Authority has given out a guide on what each type of electronic tax register must do.
Type A. Its control unit must integrate with electronic tax register. Type A electronic tax register is for traders with manual bookkeeping. This is a standalone register, which was formally known as electronic tax register machine.
Type B. This type of electronic tax register must work with a point of sales system. Type B is most suitable for restaurants, supermarkets, and retail shops. It was previously called fiscal printer.
Type C. This type of electronic tax register must have an enterprise resource planning (ERP) software, which manages a firm’s daily activities. ERP software does accounts, procurement, projects, and risks management.
Type D. This electronic tax register must have all the features of types A, B and C. It must work with point-of-sale system and must have an enterprise resource planning software.
Fines and prison for breaking the law
Value Added Tax (Electronic Tax Invoice) Regulations of 2020 give penalties for taxpayers who break the regulations.
A person would be guilty if they fail to comply with any of the requirements of the regulations. Also, a person would be guilty if they tamper, manipulate, or interfere with the proper functioning of the electronic tax register.
A taxpayer could be given a fine of not more than Sh1 million, or a prison sentence not exceeding three years, or both, if found guilty.