Benefits Of Registering As A Taxpayer If You’re A Small Business Operator In KenyaKuza Blog

Minerva Biven

In his Eighth State of the Nation Tackle on 30th Nov this calendar year, President Uhuru Kenyatta submitted a report to the parliament recognizing Micro, Compact, and Medium Enterprises (MSMEs) as the lifeblood of Kenya’s economic system still a massive variety of them are unlicensed.

According to the 2017 Economic Survey, there are about 1.56 million certified MSMEs and 5.85 million unlicensed similar companies in Kenya.

This suggests that a lot less than 27 p.c of all corporations in Kenya are registered. Out of these, 92.2 percent are micro-enterprises whilst only 7.1 p.c and .7 percent are little and medium enterprises respectively.

The cause some of the MSME operators give for not registering their organizations is that they dread staying subjected to substantial taxation that may perhaps end up consuming on their revenue.

Nevertheless, as you will soon find out, there are many added benefits that await unregistered MSME operators as taxpayers that which includes financial loans and federal government expert services. 

Bid for government contracts

Bid for authorities contracts

As a registered compact enterprise operator as a taxpayer, you will be placing your self in the best posture to bid and win governing administration tenders and trade with the authorities and non-governing administration institutions.

If your business enterprise is not registered, you can not bid for authorities contracts or even partner with other corporations to take benefit of communal benefits such as vital networks, in particular with bigger companies with who they could even enter into sub-contracts.

Thus, you will repeatedly be locked out of valuable enterprise associations. Basically place, if an business is not a taxpayer it are not able to expand!

Personalized tax and customs advisory services

Customized tax and customs advisory solutions

These are products and services available by the Kenya Revenue Authority (KRA) by its extensive network, social media, and telephony amongst others to hell MSMEs operators have an understanding of the tax and customs atmosphere specifically if they intend to get into import and export business enterprise.

This is in addition to sector and networking possibilities as a result of its taxpayers’ roundtables that the taxman organizes to carry with each other companies for reasons of sharing difficulties affecting them and getting business enterprise guidance in line with the core small business of the authority.

It is all through these conferences that the Authority avails chances for business owners to network and even build new marketplaces.

Import and export incentives

Import and export incentives

As a small enterprise operator, your goal is to mature from serving the regional persons to carrying out organization globally. No organization operator would their undertaking continue to be stagnant for this reason the need for registration.

MSMEs registered with the taxman stand the probability of acquiring import incentives that include things like reduced import tariffs on inputs this sort of as equipment and raw products to spur producing of goods for export exactly where the authority provides free of charge VAT for its users.

The taxman also has a provision for capital allowances on put in machinery and a feasible 20 per cent export compensation arrangement.

Numerous business opportunities

Several company opportunities

Did you know? In line with the federal government directive on general public procurement, 30 p.c of all procurement at KRA goes to enterprises run by the youth, females, and people today with disabilities which are primarily MSMEs. Yet another motive why you want to sign up as a smaller organization operator.

Unregistered enterprises need to sign-up as taxpayers in order to open doors to company possibilities that can only be accessed the moment the small business acquires the all-crucial PIN variety.

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