Breistar Consulting - Tax Advisory

Breistar Consulting - Tax Advisory Tax Experts offering Consultancy Services on PAYE, VAT and Statutory Compliance.

23/06/2026

In many organizations, tax compliance is often treated as a once-a-year obligation. In reality, it is a daily discipline—and it starts with proper bookkeeping.

Accurate and timely record-keeping is not just an accounting function; it is the foundation of credible financial reporting and compliant tax positions. When books are well maintained, tax returns become a reflection of reality—not a rushed reconstruction of it.

Poor bookkeeping, on the other hand, creates a ripple effect:
• Misstated revenues and expenses
• Missed allowable deductions
• Increased exposure to penalties and audits
• Strained cash flow from unexpected tax liabilities

Discipline in bookkeeping means:
✔ Recording transactions promptly and accurately
✔ Reconciling accounts regularly
✔ Maintaining proper documentation for every entry
✔ Leveraging systems that ensure consistency and audit trails

For business leaders, this is not just about compliance—it’s about control. Clean books provide clarity for decision-making, build confidence with stakeholders, and ultimately protect the business from avoidable risks.

As professionals in finance and business, we must continue to emphasize this:
Tax compliance is not built at filing—it is built every day in the books.

24/03/2026

🚨 𝐁𝐈𝐆 𝐓𝐀𝐗 𝐒𝐇𝐈𝐅𝐓 𝐀𝐋𝐄𝐑𝐓:

𝐈𝐬 𝐌𝐚𝐧𝐝𝐚𝐭𝐨𝐫𝐲 𝐕𝐀𝐓 𝐟𝐨𝐫 𝐀𝐋𝐋 𝐁𝐮𝐬𝐢𝐧𝐞𝐬𝐬𝐞𝐬 𝐭𝐡𝐞 𝐑𝐢𝐠𝐡𝐭 𝐌𝐨𝐯𝐞?

The Kenya Revenue Authority (KRA) has proposed a bold policy shift—making VAT registration mandatory for all businesses, regardless of turnover.

Currently, only businesses earning above 𝐊𝐬𝐡 𝟓 𝐦𝐢𝐥𝐥𝐢𝐨𝐧 annually are required to charge VAT. But if this proposal goes through, every business—small or large—will be required to charge 16% VAT and file monthly returns.

KRA projects that this move could increase VAT collections from the current Ksh 653 billion to over Ksh 1 trillion.

🔍 𝐖𝐡𝐚𝐭 𝐝𝐨𝐞𝐬 𝐭𝐡𝐢𝐬 𝐦𝐞𝐚𝐧 𝐢𝐧 𝐫𝐞𝐚𝐥𝐢𝐭𝐲?
💰 1. Likely Increase in Prices
Small businesses currently not charging VAT will now factor in the 16% tax: Everyday items like snacks, soft drinks, cosmetics, and even services may become more expensive. The burden will ultimately fall on the end consumer

📊 2. Heavy Compliance Burden on SMEs For many small businesses, this is not just about tax—it’s about systems and capacity:
✅Monthly VAT filings
✅Mandatory use of eTIMS
✅Record keeping and invoice management
For a small trader, compliance could become a full-time job rather than a support function.

⚠️ 3. Risk of Informality & Business Slowdown
Kenya’s informal sector employs over 80% of the workforce. Imposing VAT across the board could:
>Push small traders out of the formal system
>Encourage cash-based, non-compliant transactions
>Discourage startups and small business growth

📉 4. Cost vs Revenue Debate
While the goal is to widen the tax base: The cost of enforcing compliance on micro-businesses may outweigh the revenue collected
Globally, VAT thresholds exist to avoid overburdening small enterprises

🧠 𝐊𝐞𝐲 𝐓𝐚𝐤𝐞𝐚𝐰𝐚𝐲𝐬
✔️ Broadening the tax base is necessary—but how it’s done matters
✔️ Without simplification, this could become a compliance nightmare for SMEs
✔️ Expect price pressures on consumers in the short term
✔️ Policy success will depend on support systems, digital literacy, and simplified processes

💬 𝐌𝐲 𝐓𝐚𝐤𝐞
This proposal is less about taxation and more about economic structure. If implemented without safeguards, it risks hurting the very backbone of Kenya’s economy—the small business sector.

👉 𝐐𝐮𝐞𝐬𝐭𝐢𝐨𝐧:
Do you think mandatory VAT for all businesses will improve tax fairness—or strain already struggling SMEs?



18/03/2026

💡 𝐔𝐧𝐝𝐞𝐫𝐬𝐭𝐚𝐧𝐝𝐢𝐧𝐠 𝐑𝐞𝐯𝐞𝐫𝐬𝐞 𝐈𝐧𝐯𝐨𝐢𝐜𝐢𝐧𝐠 𝐛𝐲 𝐊𝐑𝐀: 𝐖𝐡𝐚𝐭 𝐄𝐯𝐞𝐫𝐲 𝐓𝐚𝐱𝐩𝐚𝐲𝐞𝐫 𝐒𝐡𝐨𝐮𝐥𝐝 𝐊𝐧𝐨𝐰

🔄 𝐖𝐡𝐚𝐭 𝐢𝐬 𝐑𝐞𝐯𝐞𝐫𝐬𝐞 𝐈𝐧𝐯𝐨𝐢𝐜𝐢𝐧𝐠?

Reverse invoicing is a system where the buyer generates an electronic tax invoice on behalf of a supplier who may not be compliant with e -TIMS (electronic Tax Invoice Management System).

This service was specifically introduced by KRA to enable tax payers generate invoices on behalf of small businesses like mama mbogas in order to stay eTIMS compliant. Reverse invoicing requires the buyer to initiate the process and then wait for the seller to approve the transaction.

✅ 𝐊𝐞𝐲 𝐁𝐞𝐧𝐞𝐟𝐢𝐭𝐬

✔️ Improves Tax Compliance – Ensures all transactions are captured in KRA systems, even from non-compliant suppliers.
✔️ Enhances Input VAT Claims – Buyers can still claim allowable VAT by generating valid invoices.
✔️ Promotes Transparency – Reduces tax evasion and brings more businesses into the tax net.
✔️ Supports Business Continuity – Allows businesses to transact smoothly even when suppliers are not onboarded to eTIMS.

⚠️ 𝐂𝐡𝐚𝐥𝐥𝐞𝐧𝐠𝐞𝐬 𝐭𝐨 𝐖𝐚𝐭𝐜𝐡 𝐎𝐮𝐭 𝐅𝐨𝐫

❌ Increased Responsibility on Buyers – Buyers must ensure accurate invoice generation to avoid penalties.
❌ System Dependence – Requires access to KRA systems (eTIMS), which may be a hurdle for some taxpayers.
❌ Supplier Resistance – Some suppliers may be reluctant or unaware of the process.
❌ Risk of Errors – Incorrect invoice details can lead to compliance issues or denied VAT claims.

📌 𝐖𝐡𝐚𝐭 𝐒𝐡𝐨𝐮𝐥𝐝 𝐘𝐨𝐮 𝐃𝐨?

👉 Ensure you understand how reverse invoicing works within eTIMS
👉 Train your finance team on proper invoice generation
👉 Engage your suppliers to encourage full compliance

🔍 𝐁𝐨𝐭𝐭𝐨𝐦 𝐋𝐢𝐧𝐞:

Reverse invoicing is a powerful tool for strengthening tax compliance—but like any system, it requires proper understanding and ex*****on to fully benefit.



𝐋𝐚𝐭𝐞𝐬𝐭 𝐔𝐩𝐝𝐚𝐭𝐞 𝐟𝐫𝐨𝐦 𝐊𝐑𝐀𝐃𝐢𝐬𝐜𝐨𝐧𝐭𝐢𝐧𝐮𝐚𝐭𝐢𝐨𝐧 𝐨𝐟 𝐭𝐡𝐞 𝐮𝐬𝐞 𝐨𝐟 '𝐒𝐩𝐞𝐜𝐢𝐚𝐥 𝐓𝐚𝐛𝐥𝐞'In a notice issued on 10th of March 2026, KRA has dis...
11/03/2026

𝐋𝐚𝐭𝐞𝐬𝐭 𝐔𝐩𝐝𝐚𝐭𝐞 𝐟𝐫𝐨𝐦 𝐊𝐑𝐀

𝐃𝐢𝐬𝐜𝐨𝐧𝐭𝐢𝐧𝐮𝐚𝐭𝐢𝐨𝐧 𝐨𝐟 𝐭𝐡𝐞 𝐮𝐬𝐞 𝐨𝐟 '𝐒𝐩𝐞𝐜𝐢𝐚𝐥 𝐓𝐚𝐛𝐥𝐞'

In a notice issued on 10th of March 2026, KRA has discontinued the use of the infamous 'special table' and announced that henceforth it will only apply to taxpayers engaging in missing trader schemes or Fraud.

In its own admission, KRA acknowledges that the Special table as a compliance tool has been abused to punish genuine taxpayers instead of facilitating them to do business and pay their taxes.

This move by KRA brings a much needed reprieve for many businesses whose operations had been severely curtailed after being placed on the 'special table'

For genuine taxpayers who are set to be removed from the KRA special table, this is a major victory. However, their next area of concern will be on the penalties and interests accumulated as a result of being placed on the special table. Will there be a waiver on the same?



𝐂𝐚𝐧 𝐲𝐨𝐮𝐫 𝐛𝐮𝐬𝐢𝐧𝐞𝐬𝐬 𝐒𝐮𝐫𝐯𝐢𝐯𝐞 𝐚 𝐓𝐚𝐱 𝐝𝐞𝐟𝐚𝐮𝐥𝐭?Tax compliance is not a mere suggestion by the tax authorities. It's a legal req...
10/03/2026

𝐂𝐚𝐧 𝐲𝐨𝐮𝐫 𝐛𝐮𝐬𝐢𝐧𝐞𝐬𝐬 𝐒𝐮𝐫𝐯𝐢𝐯𝐞 𝐚 𝐓𝐚𝐱 𝐝𝐞𝐟𝐚𝐮𝐥𝐭?

Tax compliance is not a mere suggestion by the tax authorities. It's a legal requirement and therefore 𝐦𝐚𝐧𝐝𝐚𝐭𝐨𝐫𝐲 for everyone doing business in Kenya.

Compliance may appear complex but it gives you peace of mind knowing very well the future of your business is protected.

You can build a business on passion but it takes 𝐝𝐢𝐬𝐜𝐢𝐩𝐥𝐢𝐧𝐞 to sustain it.

As a business, ensure you have clean records for all your operations.

Proper book keeping is the cornerstone of compliance.

Late filings, unpaid taxes and ignored notices may feel small today. But they might lead to penalties which accrue silently and consistently but with dire repercussions.

Compliance is not just about avoiding penalties, it's about credibility. It's about 𝐨𝐩𝐞𝐫𝐚𝐭𝐢𝐧𝐠 𝐰𝐢𝐭𝐡𝐨𝐮𝐭 𝐟𝐞𝐚𝐫 of the next audit or system review.



06/03/2026

𝐐𝐮𝐢𝐜𝐤 𝐔𝐩𝐝𝐚𝐭𝐞 𝐟𝐫𝐨𝐦 𝐊𝐑𝐀

𝐑𝐞𝐢𝐧𝐭𝐫𝐨𝐝𝐮𝐜𝐭𝐢𝐨𝐧 𝐨𝐟 𝐍𝐈𝐋 𝐅𝐢𝐥𝐢𝐧𝐠 𝐨𝐧 𝐭𝐡𝐞 𝐊𝐑𝐀 𝐓𝐚𝐱𝐩𝐚𝐲𝐞𝐫 𝐏𝐨𝐫𝐭𝐚𝐥.

Early this year, KRA suspended the NIL filing as part of a broader compliance and data validation initiative.

This move was meant to achieve the following objectives:

- Curb misuse of NIL returns
- Identify Tax payers filing NIL despite having economic activities
- Align eTIMS data, Withholding tax records and customs & third-party records

KRA has since reintroduced the NIL filing on the taxpayers' portal. This therefore marks the conclusion of the initial data validation phase which essentially signals a shift towards a more controlled and data-driven NIL filing framework.



03/03/2026

𝗜𝗺𝗽𝗮𝗰𝘁 𝗼𝗳 𝗞𝗥𝗔'𝘀 𝗲𝗧𝗜𝗠𝗦 𝘃𝗮𝗹𝗶𝗱𝗮𝘁𝗶𝗼𝗻 𝗲𝘅𝗲𝗿𝗰𝗶𝘀𝗲 𝗼𝗻 𝗯𝘂𝘀𝗶𝗻𝗲𝘀𝘀 𝗼𝗽𝗲𝗿𝗮𝘁𝗶𝗼𝗻𝘀.

𝗪𝗵𝗮𝘁 𝗲𝗧𝗜𝗠𝗦 𝘃𝗮𝗹𝗶𝗱𝗮𝘁𝗶𝗼𝗻 𝗮𝗰𝘁𝘂𝗮𝗹𝗹𝘆 𝗺𝗲𝗮𝗻𝘀.

𝐕𝐞𝐫𝐢𝐟𝐢𝐜𝐚𝐭𝐢𝐨𝐧 𝐨𝐟 𝐝𝐞𝐜𝐥𝐚𝐫𝐞𝐝 𝐢𝐧𝐜𝐨𝐦𝐞. The new policy by KRA requires that all sales/income reported by a business or an individual must be supported by valid eTIMS generated invoices. In case of any variances, the tax payer will be required to explain further.

𝐕𝐞𝐫𝐢𝐟𝐢𝐜𝐚𝐭𝐢𝐨𝐧 𝐨𝐟 𝐜𝐥𝐚𝐢𝐦𝐞𝐝 𝐞𝐱𝐩𝐞𝐧𝐬𝐞𝐬. Only expenses supported by valid eTIMS invoices bearing the taxpayers PIN will be allowable for tax purposes. Expenses not supported by eTIMS records however genuine will be rejected.

𝐂𝐨𝐧𝐬𝐞𝐪𝐮𝐞𝐧𝐜𝐞𝐬 𝐨𝐟 𝐍𝐨𝐧-𝐂𝐨𝐦𝐩𝐥𝐢𝐚𝐧𝐜𝐞 𝐰𝐢𝐭𝐡 𝐭𝐡𝐞 𝐧𝐞𝐰 𝐩𝐨𝐥𝐢𝐜𝐲

- KRA may issue additional assessment to a certain the accuracy of the sales or expenses reported.

- Expenses claimed by the business will be disallowed for tax purposes

- KRA may also impose penalties once they confirm non-compliance on the part of the taxpayer.



02/03/2026

𝐓𝐀𝐗 𝐇𝐄𝐀𝐋𝐓𝐇 𝐂𝐇𝐄𝐂𝐊

Most businesses don’t run into tax problems because they ignore tax.

They run into problems because they assume:

• “We’ve always done it this way”
• “Our filings are probably okay”
• “We’ll sort it out if an issue arises”

Tax risk rarely shows up suddenly.
It builds quietly through small gaps in compliance, documentation, and understanding.

A Tax Health Check is a simple, structured review that helps businesses:

• Identify potential tax exposure early
• Assess VAT and PAYE compliance accuracy
• Review documentation and record-keeping practices
• Highlight areas requiring attention before penalties arise

This is not an audit.

It is a preventive review designed to provide clarity and peace of mind.

As tax compliance expectations continue to evolve under Kenya Revenue Authority, proactive review has never been more important.

If you’re unsure about your current tax position, a short conversation can help determine whether a tax health check would be useful.

Tax clarity is always cheaper than tax correction.


𝐈𝐌𝐏𝐎𝐑𝐓𝐀𝐍𝐓 𝐔𝐏𝐃𝐀𝐓𝐄.𝐅𝐈𝐋𝐈𝐍𝐆 𝐎𝐅 𝐍𝐈𝐋 𝐑𝐄𝐓𝐔𝐑𝐍𝐒 𝐓𝐄𝐌𝐏𝐎𝐑𝐀𝐑𝐈𝐋𝐘 𝐒𝐔𝐒𝐏𝐄𝐍𝐃𝐄𝐃The Kenya Revenue Authority (KRA) has temporarily suspended ...
20/02/2026

𝐈𝐌𝐏𝐎𝐑𝐓𝐀𝐍𝐓 𝐔𝐏𝐃𝐀𝐓𝐄.

𝐅𝐈𝐋𝐈𝐍𝐆 𝐎𝐅 𝐍𝐈𝐋 𝐑𝐄𝐓𝐔𝐑𝐍𝐒 𝐓𝐄𝐌𝐏𝐎𝐑𝐀𝐑𝐈𝐋𝐘 𝐒𝐔𝐒𝐏𝐄𝐍𝐃𝐄𝐃

The Kenya Revenue Authority (KRA) has temporarily suspended the filing of nil returns to curb tax evasion, with the suspension in place until March 30, 2026. This move targets individuals who file nil returns despite having income, using data from eTIMS, withholding tax, and customs to identify discrepancies. The measure aims to convert non-filers and zero-filers into active taxpayers, with a focus on validating data and strengthening compliance, particularly for those with taxable income.

𝐊𝐞𝐲 𝐝𝐞𝐭𝐚𝐢𝐥𝐬 𝐫𝐞𝐠𝐚𝐫𝐝𝐢𝐧𝐠 𝐭𝐡𝐞 𝐬𝐮𝐬𝐩𝐞𝐧𝐬𝐢𝐨𝐧:

𝐏𝐮𝐫𝐩𝐨𝐬𝐞: The initiative aims to force taxpayers who live large but declare no income into the tax net.

𝐒𝐜𝐨𝐩𝐞: The suspension affects persistent nil-filers, entities without VAT returns for six months, and traders failing to adopt eTIMS.

𝐍𝐞𝐱𝐭 𝐒𝐭𝐞𝐩𝐬: Taxpayers are urged to check their portal for updates and prepare to file accurate returns.

𝐈𝐦𝐩𝐚𝐜𝐭: The suspension is part of KRA's broader, data-driven approach to tax enforcement.

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