Tax rates
Tax rates are applied to sales and purchase lines, and to payments where tax is withheld. Each rate knows which account it is posted to and, for VAT, the KRA eTIMS tax code sent with each line.
The starting rates
| Code | Name | eTIMS | Posted to (sales) |
|---|---|---|---|
| VAT16 | VAT 16% | B | VAT payable |
| VAT8 | VAT 8% (petroleum products) | E | VAT payable |
| ZERO | Zero-rated (0%) | C | VAT payable |
| EXEMPT | Exempt from VAT | A | - |
| NONVAT | Not subject to VAT | D | - |
| WHVAT2 | Withholding VAT 2% | - | Withholding VAT receivable |
| WHT5 | Withholding tax 5% (professional and management fees) | - | Withholding tax receivable |
If your business is VAT registered, VAT 16% is the default for new lines; otherwise Not subject to VAT is.
Changing rates
Click a rate to edit it, or choose New tax rate for another (for example a different withholding rate). Rates are switched off rather than deleted, so documents that used them stay correct. Only a VAT rate can be the default.