To claim VAT refund in Kenya, you must submit an online application through the KRA iTax portal. Refund claims typically arise from overpaid tax, excess credits from zero-rated supplies, or bad debts.
Step-by-Step Application Process
- Log in to iTax: Enter your KRA PIN, password, and complete the security arithmetic.
- Access Refunds Menu: Navigate to the Refunds tab on the dashboard and select the appropriate tax obligation (VAT).
- Confirm Details: Verify your taxpayer information and click “Next”.
- Enter Bank Details: Provide your accurate bank account information where the refund should be deposited.
- Fill Claim Details:
- Select the Refund Type (e.g., Overpayment, Zero-rated supplies, Bad debts).
- Enter the Claim Reason and a detailed description.
- Specify the Amount being claimed.
- Upload Documents: Attach mandatory supporting documents (see below) and click “Submit”.
- Download Slip: Save the generated acknowledgement slip for tracking purposes.
Required Supporting Documents
- Proof of Overpayment: Relevant bank statements or payment receipts.
- Tax Invoices: Valid electronic tax invoices (eTIMS/TIMS) for business purchases.
- Withholding Certificates: For credits arising from the Withholding VAT system.
- Customs Documents: Import declaration and customs entry forms for imports.
- Credit/Debit Notes: Where applicable for returned goods or value reductions.
Critical Deadlines and Rules
- General Claims: Must be lodged within 12 months from the date the tax became due and payable.
- Bad Debts: Can be claimed after 3 years but before 10 years from the date of supply (or if the buyer is legally insolvent).
- Withholding VAT: Applications for credits arising after July 2019 must be made within 24 months.
- Processing Time: KRA typically issues a decision within 90 to 120 days. If approved, funds are usually disbursed within two years of the application date.
Note: Ensure you have a valid debt status report before applying, as outstanding tax debts may lead to the refund being used as an offset instead of a cash payout
