November 30, 2022

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

In his Eighth Point out of the Country Address on 30th Nov this yr, President Uhuru Kenyatta submitted a report to the parliament recognizing Micro, Modest, and Medium Enterprises (MSMEs) as the lifeblood of Kenya’s financial system however a large range of them are unlicensed.

According to the 2017 Financial Survey, there are about 1.56 million accredited MSMEs and 5.85 million unlicensed very similar corporations in Kenya.

This indicates that considerably less than 27 % of all businesses in Kenya are registered. Out of these, 92.2 % are micro-enterprises though only 7.1 p.c and .7 percent are little and medium enterprises respectively.

The reason some of the MSME operators give for not registering their businesses is that they anxiety being subjected to large taxation that may end up taking in on their earnings.

On the other hand, as you will shortly find, there are quite a few benefits that await unregistered MSME operators as taxpayers that like financial loans and governing administration solutions. 

Bid for government contracts

Bid for federal government contracts

As a registered compact business enterprise operator as a taxpayer, you will be placing by yourself in the greatest situation to bid and gain govt tenders and trade with the authorities and non-govt institutions.

If your organization is not registered, you cannot bid for federal government contracts or even spouse with other enterprises to take advantage of communal benefits together with very important networks, specially with bigger businesses with who they could even enter into sub-contracts.

Consequently, you will constantly be locked out of handy business enterprise associations. Simply just set, if an company is not a taxpayer it can not grow!

Personalized tax and customs advisory services

Individualized tax and customs advisory solutions

These are services made available by the Kenya Earnings Authority (KRA) by its huge community, social media, and telephony among other people to hell MSMEs operators realize the tax and customs ecosystem specially if they intend to get into import and export company.

This is in addition to market place and networking chances by way of its taxpayers’ roundtables that the taxman organizes to convey with each other enterprises for needs of sharing problems affecting them and obtaining enterprise assistance in line with the main company of the authority.

It is all through these meetings that the Authority avails chances for entrepreneurs to community and even build new marketplaces.

Import and export incentives

Import and export incentives

As a compact organization operator, your purpose is to grow from serving the regional individuals to executing company globally. No business operator would their undertaking stay stagnant that’s why the require for registration.

MSMEs registered with the taxman stand the likelihood of getting import incentives that incorporate lessened import tariffs on inputs such as machinery and raw supplies to spur manufacturing of merchandise for export exactly where the authority offers cost-free VAT for its users.

The taxman also has a provision for money allowances on mounted machinery and a doable 20 per cent export compensation arrangement.

Numerous business opportunities

Several company chances

Did you know? In line with the govt directive on public procurement, 30 p.c of all procurement at KRA goes to enterprises run by the youth, women, and folks with disabilities which are predominantly MSMEs. A further purpose why you need to have to sign up as a modest enterprise operator.

Unregistered enterprises should sign up as taxpayers in order to open doorways to enterprise opportunities that can only be accessed when the small business acquires the all-essential PIN selection.