eTIMS in Kenya (2026): What Every Business Must Do
Since January 2026, KRA validates the expenses on your return against eTIMS. Purchases without a valid electronic invoice can be disallowed and taxed. Here is what that means and what to do.
What Changed in 2026
From 1 January 2026, KRA cross-checks your income tax return against three data sources: TIMS/eTIMS invoice records, the gross amounts on Withholding Income Tax, and Customs import data. Anything that does not reconcile gets flagged.
Expenses not backed by a valid electronic invoice (carrying the buyer PIN where applicable) are disallowed, which raises your taxable profit and your tax. This builds on a rule already in force since 1 January 2024; 2026 simply switches on automated validation, starting with 2025 returns filed by 30 June 2026.
Who Has to Onboard
Since 1 September 2023, all persons carrying on business must onboard eTIMS and issue electronic invoices, whether or not they are VAT-registered.
- Companies, partnerships and sole proprietors
- Associations, trusts and NGOs
- VAT-exempt sectors: hospitals, schools, tours and travel
- Landlords and turnover-tax payers
What’s Exempt
Section 23A of the Tax Procedures Act lets some payments sit outside the e-invoice requirement: emoluments (payroll), imports, investment allowances, interest, airline passenger ticketing and withholding-tax payments.
Almost everything else your business buys needs a valid eTIMS invoice to be deductible, so do not assume an expense is exempt without checking.
The Under-KES-5M Relief
Suppliers with annual turnover up to KES 5 million do not issue their own eTIMS invoices. Instead the buyer issues the invoice on the seller’s behalf, with the seller’s consent, through eCitizen or USSD *222#. This is buyer-initiated, or reverse, invoicing under the Tax Procedures Act.
It still has to be set up correctly, which is where an accountant helps.
How to Stay Deductible
Onboard through the method that fits your size: eTIMS Lite (web via eCitizen, USSD *222#, or the "eTIMS Non VAT" app) for small and non-VAT businesses, or the online portal and eTIMS client for larger or multi-branch operations.
Then make sure every supplier issues a compliant invoice with your PIN, and reconcile monthly. An accountant configures invoicing, trains your team and keeps your expenses defensible.
eTIMS Compliance Accountants
Verified CPA-K, ACCA and CIFA professionals who handle this.
Common Questions
Who needs eTIMS in Kenya?+
All persons in business since 1 September 2023, companies, sole proprietors, partnerships, NGOs, schools, hospitals and landlords, not only VAT-registered businesses.
When did eTIMS start?+
Onboarding has been required since 1 September 2023, with a window for non-VAT taxpayers to 31 March 2024. From January 2026 KRA validates returns against eTIMS.
What expenses are exempt from eTIMS?+
Section 23A exempts emoluments, imports, investment allowances, interest, airline tickets and withholding-tax payments. Most other purchases need a valid eTIMS invoice to be deductible.
What if my supplier has no eTIMS?+
Their invoice may not be valid for your deduction, so the expense can be disallowed. Push suppliers to comply, or use buyer-initiated invoicing where the supplier is under KES 5 million turnover.
Is there relief for small businesses?+
Yes. Suppliers under KES 5 million turnover use buyer-initiated (reverse) invoicing, where the buyer issues the invoice with the seller’s consent.