What is the standard VAT rate in Kenya?

The statutory standard VAT rate in Kenya is 16%, established under the Value Added Tax Act No. 35 of 2013 and enforced by the Kenya Revenue Authority (KRA).

How do you calculate 16% VAT in Kenya?

To add 16% VAT, multiply the net price by 1.16. To remove 16% VAT from a gross amount, divide the inclusive price by 1.16.

eTIMS (electronic Tax Invoice Management System) is an initiative by the KRA requiring all businesses to electronically generate and transmit tax invoices in real time to KRA to validate business expense deductions.

Kenya 16% VAT Calculator: KRA iTax Rates, TIMS & Computation Guide

The Kenya Revenue Authority (KRA) levies Value Added Tax on taxable supplies of goods and services made in Kenya and on the importation of taxable goods. The statutory standard rate is 16%.

Following recent Finance Acts and the integration of electronic Tax Invoice Management System (eTIMS), computing 16% VAT correctly on business quotations and expense claims is essential. Our live VAT calculator delivers rapid calculations in Kenyan Shillings (KES).

KRA VAT Classification

Classification	Rate	Eligible Transactions
Standard Rate	16.0%	Commercial sales, petroleum products (fuel), electronics, professional services, hospitality, telecommunications.
Zero Rate (0%)	0.0%	Exported goods and taxable services, supply of tea/coffee for export, agricultural pest control, international transport.
Exempt Supplies	Exempt	Unprocessed agricultural produce, financial services, medical supplies and pharmaceuticals, education services.

How to Calculate 16% Kenya VAT

1. Adding 16% VAT (Exclusive to Inclusive)

To invoice a customer in Kenya starting from a net pre-tax amount:

Add 16% Formula

Gross Total = Net × 1.16 | 16% VAT = Net × 0.16

Example: A logistical delivery contract of KES 100,000.00 Net:
• 16% VAT: KES 100,000.00 × 0.16 = KES 16,000.00
• Total Invoice: KES 100,000.00 + KES 16,000.00 = KES 116,000.00

2. Removing 16% VAT (Inclusive to Exclusive / Reverse VAT)

When auditing consumer fuel receipts or hardware purchases where only the gross total is printed:

Remove 16% Formula

Net Amount = Gross ÷ 1.16 | 16% VAT = Gross - Net

Example: An electronics purchase with a receipt of KES 29,000.00 Gross:
• Net Value: KES 29,000.00 ÷ 1.16 = KES 25,000.00
• Extracted KRA VAT: KES 29,000.00 - KES 25,000.00 = KES 4,000.00

eTIMS Compliance & KRA iTax Filing

VAT-registered taxpayers in Kenya must file monthly VAT returns via KRA's iTax portal on or before the 20th day of the month following the period of tax.

Under Section 23A of the Tax Procedures Act, business expenses can only be claimed for income tax deduction if supported by an electronic tax invoice generated through an eTIMS-compliant system.

Frequently Asked Questions About Kenyan VAT

What is the mandatory VAT registration threshold in Kenya?

A business must register for VAT with the KRA if its annual taxable turnover exceeds KES 5,000,000 over a 12-month period.

What is the VAT rate on petroleum and fuel products in Kenya?

Under the Finance Act 2023 and ongoing legislation, petroleum products in Kenya are subject to the standard 16% VAT rate (increased from the previous 8% concession).