1. What is VAT?

Value Added Tax (VAT) is a consumption tax levied on goods and services in Kenya at the standard rate of 16% by the Kenya Revenue Authority (KRA). It's charged on the value added at each stage of production and distribution.

2. How Does the Calculator Work?

The calculator uses the VAT formula:

Where:

• \( Value \) — The amount in Kenyan Shillings (KES)
• \( 0.16 \) — The standard VAT rate (16%)

Explanation: The calculation simply multiplies the input value by 16% to determine the VAT amount.

3. Importance of VAT Calculation

Details: Accurate VAT calculation is crucial for businesses to comply with KRA regulations, file correct tax returns, and avoid penalties for underpayment.

4. Using the Calculator

Tips: Enter the value amount in KES (Kenyan Shillings). The value must be a positive number. The calculator will automatically compute the 16% VAT amount.

5. Frequently Asked Questions (FAQ)

Q1: What is the current VAT rate in Kenya?
A: The standard VAT rate in Kenya is 16% as set by the Kenya Revenue Authority.

Q2: Are all goods and services subject to 16% VAT?
A: No, some items are zero-rated or exempt. This calculator applies only to standard-rated supplies.

Q3: When is VAT payable to KRA?
A: VAT is typically payable monthly, by the 20th of the following month for registered persons.

Q4: Who should register for VAT in Kenya?
A: Businesses with taxable supplies exceeding KES 5 million annually must register, while those below may register voluntarily.

Q5: Can input VAT be reclaimed?
A: Registered persons can generally claim back VAT paid on business purchases, subject to certain conditions.