Kenya E-Invoicing: A Complete Guide to eTIMS Compliance

For many businesses, invoicing was once a simple process of creating an invoice and sending it to the customer. That changed in 2024, when Kenya strengthened its electronic tax invoicing rules under Section 23A of the Tax Procedures Act and the Electronic Tax Invoice Regulations. Businesses must now generate and transmit invoices through the Kenya Revenue Authority’s Electronic Tax Invoice Management System (eTIMS) or an approved integrated solution for them to qualify as compliant electronic invoices.

This has created uncertainty for freelancers, consultants, landlords, small traders and other non-VAT-registered businesses. While many believe the Kenya e-invoicing mandate applies only to VAT-registered companies, eTIMS requirements extend to anyone carrying on business. Non-VAT businesses must therefore issue compliant electronic tax invoices and choose the eTIMS method that best suits their operations, whether through eTIMS Lite, the web portal, client software or system-to-system integration.

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From 1 January 2026, KRA will begin validating income and expenses reported in tax returns against electronic records, including eTIMS/TIMS invoices, withholding tax records and customs import data, making compliant electronic tax invoices increasingly important for accurate tax reporting and expense claims. 

To prepare for this shift, KRA has given taxpayers a limited concession for the 2025 year of income, allowing certain non-eTIMS expenses as a transitional measure before full validation begins. At the same time, KRA is accelerating e-invoicing adoption through broader onboarding efforts and sector-specific enforcement, such as for fuel retailers, reinforcing that businesses must align with Kenya’s electronic tax invoice requirements.

Why e-invoicing in Kenya now affects every business

eTIMS (Electronic Tax Invoice Management System) is the Kenya Revenue Authority’s prescribed platform for generating and transmitting electronic tax invoice information. Introduced through Section 23A of the Tax Procedures Act, the system provides a framework for electronic invoicing and stock record management.

Businesses must issue electronic tax invoices through an approved eTIMS solution. These invoices must include essential details such as the words “TAX INVOICE”, supplier and purchaser information, PIN details where applicable, invoice serial number, date and time of issue, description of supply, consideration, tax rate and total tax amount.

KRA guidance clarifies that eTIMS obligations apply to persons carrying out business activities in Kenya, not only VAT-registered companies. Being below the VAT registration threshold does not automatically remove a business from eTIMS requirements. Unless specifically exempted or covered by an approved arrangement, businesses must choose a suitable eTIMS method, including the web portal, eTIMS Lite, client software or system integration.

Kenya e-invoicing legislation timeline

1 September 2023 - The eTIMS mandate begins, requiring all persons carrying on business in Kenya, including non-VAT-registered businesses, to comply unless specifically exempted. 

1 January 2024 - Businesses must support tax-deductible expenses with valid TIMS/eTIMS records, making paper and standalone PDF invoices insufficient. 

28 March 2024 - Legal Notice No. 64 of 2024 establishes eTIMS invoice requirements, exemptions and electronic stock record rules. 

1 January 2026 - KRA begins validating declared income and expenses against electronic records, increasing the importance of compliant e-invoicing. 

B2G electronic invoicing in Kenya

B2G invoicing in Kenya follows the general requirement for businesses to onboard the Kenya Revenue Authority’s Electronic Tax Invoice Management System (eTIMS). Government suppliers should also follow the National Treasury’s electronic Government Procurement system requirements, which cover supplier registration and digital procurement processes. 

Kenya’s official guidance does not set out a separate tax-invoice clearance workflow exclusively for B2G transactions, so suppliers should meet both eTIMS tax-invoice requirements and the relevant public-procurement procedures.

B2B electronic invoicing in Kenya

All persons carrying on business, including VAT and non-VAT registered taxpayers, must issue electronic invoices. For B2B transactions, the eTIMS online portal requires the buyer’s PIN and name when generating the sales invoice or receipt. From 1 January 2024, a business expense must be supported by a valid electronic tax invoice to be deductible for income-tax purposes.

B2C e-invoicing and fiscalization in Kenya

B2C e-invoicing and fiscalisation are mandatory in Kenya. Businesses selling to individual consumers must record sales and issue electronic tax invoices or receipts through KRA’s eTIMS. Fiscalisation means that sales data is captured through an approved eTIMS solution and transmitted to KRA.

Businesses can use the eTIMS Online Portal, eTIMS Client, mobile or USSD solutions, or integrate their billing and POS systems through OSCU or VSCU. Online solutions require internet access, while eTIMS Client and VSCU can continue issuing invoices offline and transmit the data when connectivity returns.

Choosing the right Kenya electronic tax invoice solution

A consultant issuing a few invoices a month does not have the same needs as a retailer with several branches or a company processing thousands of transactions. KRA therefore offers different eTIMS solutions to match transaction volume and system complexity.

• The online portal provides web‑based invoicing for businesses that can work directly on KRA’s platform.
• The downloadable eTIMS Client supports multiple branches and cashier points, connecting different tills to a central eTIMS environment.
• eTIMS Lite suits small and micro businesses, especially non‑VAT taxpayers, who need a simple way to issue compliant electronic tax invoices without full enterprise software.

Businesses with existing billing, accounting or ERP systems can use system‑to‑system integration. KRA facilitates this via two options:

• OSCU (Online Sales Control Unit) for invoicing systems that are always online.
• VSCU (Virtual Sales Control Unit) for bulk invoicing or systems that are not always online.

Businesses implementing eTIMS typically use an invoicing platform as their main invoicing system, connected to eTIMS via OSCU or VSCU. Platforms such as DDD Invoices follow the same integration approach in supported markets, automatically transmitting invoices in the required format through certified connections.

How DDD Invoices supports Kenya e-invoicing

For Kenyan businesses, the real challenge is not just understanding eTIMS rules, but embedding them into day‑to‑day invoicing without slowing down operations. DDD Invoices can help by acting as a unified invoicing layer with a single API for billing data, customer records and tax treatment, so teams don’t have to manage separate formats or tools for different channels. 

DDD Invoices can also connect to KRA’s system‑to‑system integration options (OSCU or VSCU), so that invoices generated in DDD Invoices are automatically transmitted to eTIMS in the required format. With this integration, automation can take over the repetitive steps pushing invoice data to eTIMS, handling acknowledgements and reducing manual re‑entry so both VAT and non‑VAT business units keep their invoicing and compliance in one controlled, API‑driven flow instead of switching between multiple tools.

FAQs

Is eTIMS mandatory for non-VAT-registered businesses in Kenya?

Yes. eTIMS applies to persons carrying on business in Kenya, including businesses that are not registered for VAT, unless they fall within a specific legal exemption or approved arrangement. Non-VAT businesses can use simplified options such as eTIMS Lite Web, USSD or the eTIMS Non VAT mobile app.

Does using eTIMS mean a business must charge VAT?

No. Using eTIMS does not automatically make a business VAT registered. A business should charge VAT only when it is required to do so under the VAT Act and based on its registration status and the nature of the supply.

Is a PDF invoice automatically eTIMS compliant?

No. A PDF invoice is not compliant simply because it contains the correct information or has a professional design. The invoice data must also be generated and transmitted through an approved eTIMS solution or a properly integrated invoicing system.

Can an existing accounting or invoicing system connect to eTIMS?

Yes. Businesses with existing billing, accounting or ERP systems can connect to eTIMS through system-to-system integration. KRA supports OSCU for systems that operate online and VSCU for bulk invoicing or systems that are not continuously online.