Kenya Fiscalization: TIMS vs eTIMS Requirements and 2026 Update

Kenya has a mandatory fiscalization system through the Kenya Revenue Authority’s (KRA) electronic Tax Invoice Management System (eTIMS). Persons carrying on business including many non-VAT registered businesses must record sales, issue electronic tax invoices and transmit the data to KRA. Businesses may use eTIMS software or, where applicable, compliant electronic tax registers.

Electronic invoices and receipts must contain prescribed details, including the supplier’s PIN, invoice identifiers, transaction details and a QR code. The system supports KRA’s tax monitoring and VAT compliance processes, although certain transactions such as emoluments, imports, interest and airline passenger ticketing are excluded. 

Latest fiscalization news in Kenya

Kenya is tightening the link between eTIMS/TIMS and income-tax compliance. From 1 January 2026, KRA began validating income and expenses reported in income-tax returns against electronic invoice, withholding-tax and Customs records. For the 2026 year of income onwards, businesses must support declared income and expenses with valid eTIMS or TIMS invoices.

KRA has also integrated eTIMS with the government’s IFMIS procurement and payment system. From 31 August 2026, suppliers must generate a valid eTIMS invoice before submitting a supply for payment through IFMIS. KRA has additionally improved the eTIMS portal so businesses can view invoices issued through Client, eCitizen, VSCU and OSCU solutions in one place.

What does fiscalization mean in Kenya?

In Kenya, fiscalization means recording each business sale through the Kenya Revenue Authority’s (KRA) prescribed electronic invoicing system and issuing an electronic tax invoice or receipt. Businesses must use eTIMS or, where applicable, a compliant electronic tax register to generate invoices, capture required transaction details and transmit invoice data to KRA in real time or near real time. The system is designed to standardise, validate and monitor business transactions for tax purposes.

A compliant invoice must contain prescribed information, including the supplier’s KRA PIN, invoice number, date and time, goods or service details, tax information where applicable and a QR code. Businesses must also maintain sales records and, where required, stock records. This makes Kenya’s system more than a standard VAT record-keeping requirement, invoice data is transmitted to KRA and used to support tax monitoring, VAT compliance and validation of business income and expenses.

Legislation timeline

• 1 August 2021: KRA began rolling out upgraded TIMS electronic tax registers for VAT-registered taxpayers, with a 12-month transition period.
• 1 September 2023: KRA extended electronic tax invoicing requirements to all persons carrying on business, including non-VAT-registered businesses, through eTIMS.
• 28 March 2024: The Tax Procedures (Electronic Tax Invoice) Regulations, 2024 came into force, setting the current rules on system use, invoice data, transmission, exclusions and exemptions.
• 1 January 2026: KRA began validating income and expenses declared in income-tax returns against eTIMS/TIMS invoice data and other tax records.

Fiscal regulations that affect businesses in Kenya

VAT invoicing and electronic tax invoice rules

Businesses must issue electronic tax invoices or receipts through KRA’s eTIMS system or a compliant TIMS electronic tax register. For B2B purchases, buyers need a valid invoice transmitted to KRA with their PIN to claim input VAT.

Electronic invoicing and eTIMS reporting

In Kenya, e-invoicing is carried out through eTIMS. All persons carrying on business, including many non-VAT businesses, must onboard eTIMS, issue electronic tax invoices and transmit invoice data to KRA. KRA uses TIMS/eTIMS data to pre-fill VAT returns and, from 1 January 2026, validate income and expenses declared in income-tax returns.

Stock records and income-tax evidence

Businesses generally record sales and maintain stock records through eTIMS. KRA’s online portal is available for service-only businesses that do not supply goods and issue no more than 10 invoices a month.

Implications and penalties for non-compliance

In Kenya, failure to comply with eTIMS or TIMS requirements can lead to both financial and commercial consequences. Under the Tax Procedures Act, a taxpayer who fails to comply with an electronic tax system requirement may face a penalty of twice the tax due after KRA has issued a notice and found the taxpayer’s explanation unsatisfactory. It is also an offence to tamper with, manipulate or interfere with the electronic invoicing system.

Non-compliance can also affect a business’s ability to operate smoothly. KRA has stated that VAT-registered taxpayers that do not comply with electronic tax invoice requirements may be denied a Tax Compliance Certificate and may not have VAT refunds processed. In addition, customers cannot use non-compliant invoices to support business-expense deductions or input VAT claims, which may discourage them from dealing with non-compliant suppliers.

Your trusted partner for fiscalization in Kenya

Managing fiscalization in Kenya means issuing compliant electronic tax invoices through eTIMS or TIMS, transmitting transaction data to KRA, maintaining accurate sales and stock records, and reconciling invoice data with VAT and income-tax compliance processes. Businesses also need to manage buyer PIN capture, QR-code invoice requirements, credit notes and system integrations without disrupting everyday sales operations.

DDD Invoices helps businesses connect their ERP, billing, e-commerce or POS systems to fiscalization and e-invoicing workflows. Through a unified integration approach, it can support compliant invoice creation, transaction-data handling and reporting processes across B2B, B2C and B2G operations, helping businesses reduce manual work while adapting to Kenya’s evolving eTIMS requirements.

FAQs

Is fiscalization mandatory in Kenya?

Yes. Kenya requires persons carrying on business to issue electronic tax invoices through KRA’s eTIMS system or, where applicable, a compliant TIMS electronic tax register. The obligation can apply to non-VAT-registered businesses as well as VAT-registered businesses, unless a statutory exclusion or specific exemption applies.

What is the difference between TIMS and eTIMS in Kenya?

TIMS is the earlier electronic tax register framework, typically using compliant electronic tax registers and control units. eTIMS is KRA’s software-based electronic Tax Invoice Management System, which offers web, mobile, desktop, POS and ERP-integration options for issuing and transmitting electronic invoices.

Do businesses need to include a QR code on Kenyan electronic invoices?

Yes. Kenya’s electronic tax invoice rules require a compliant invoice to include a QR code, along with information such as the supplier’s KRA PIN, invoice identifiers, issue date and time, item details and applicable tax information. The QR code can be used to verify the invoice.

Which transactions are excluded from eTIMS requirements?

Specified exclusions include emoluments, imports, interest, airline passenger ticketing, certain financial-institution fees, investment allowances and certain expenses subject to final withholding tax. Businesses should check the full statutory list and confirm whether an exemption applies before treating a transaction as excluded.