In a significant move towards enhancing efficiency and user experience, the Kenya Revenue Authority (KRA) has announced the simplification of the Value Added Tax (VAT) return filing process, set to take effect from the January 2024 tax period.

The initiative aims to leverage technology to pre-fill VAT returns with relevant tax information, streamlining the filing process for taxpayers.

"Kenya Revenue Authority (KRA) wishes to notify the public and all VAT registered taxpayers that in an effort to leverage on technology and improve taxpayer experience, the VAT return will be pre-filled with tax information available to KRA with effect from the January 2024 tax period, to simplify the VAT return filing process for taxpayers," the authority stated in notice to the public.

As part of this transition, KRA emphasizes the mandatory requirement for taxpayers to issue electronic tax invoices and transmit invoice details to the authority, adhering to the legal provisions in place.

KRA warns that any input VAT claim not validated through the Tax Invoice Monitoring System (TIMS) or its electronic counterpart (eTIMS), or against existing customs import declarations for import VAT claims, will not be permitted.

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To assist taxpayers in conforming to electronic tax invoicing requirements, a list of approved eTIMS third-party system-to-system integrators is available on the KRA website.

This measure is designed to facilitate compliance and ensure seamless integration into the simplified VAT return filing system.

Moreover, KRA clarifies that the pre-filled VAT return will constitute a self-assessment return, in accordance with Section 28(4) of the Tax Procedures Act, CAP 469B.

Importantly, taxpayers remain obligated to confirm the accuracy of their declarations before submitting the return.

In the same notice, KRA affirms its commitment to conducting sensitization programs for taxpayers, aiming to familiarize them with the simplified VAT return filing process.

The authority pledges ongoing support and facilitation to ensure all taxpayers comply with the electronic tax invoicing requirements.

"We will conduct sensitization for taxpayers on the simplified VAT Return filing process and will continue to support and facilitate all taxpayers to comply with the electronic tax invoicing requirements," stated KRA.

This move towards technological integration reflects KRA's dedication to modernizing tax processes, ultimately fostering a more efficient and user-friendly system for VAT return filing in Kenya.