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

In his Eighth State of the Country Address on 30th Nov this 12 months, President Uhuru Kenyatta submitted a report to the parliament recognizing Micro, Tiny, and Medium Enterprises (MSMEs) as the lifeblood of Kenya’s economic system nonetheless a large range of them are unlicensed.

In accordance to the 2017 Economic Survey, there are about 1.56 million accredited MSMEs and 5.85 million unlicensed equivalent businesses in Kenya.

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

The cause some of the MSME operators give for not registering their enterprises is that they worry being subjected to superior taxation that may perhaps conclusion up feeding on on their profit.

On the other hand, as you will shortly find, there are a lot of positive aspects that await unregistered MSME operators as taxpayers that like loans and federal government products and services. 

Bid for federal government contracts

As a registered small small business operator as a taxpayer, you will be placing your self in the best place to bid and acquire govt tenders and trade with the government and non-governing administration establishments.

If your business enterprise is not registered, you simply cannot bid for federal government contracts or even companion with other corporations to take edge of communal gains such as essential networks, in particular with much larger providers with who they could even enter into sub-contracts.

For that reason, you will continuously be locked out of beneficial small business associations. Basically place, if an enterprise is not a taxpayer it can not increase!

Personalised tax and customs advisory providers

These are companies available by the Kenya Earnings Authority (KRA) through its huge community, social media, and telephony among the other folks to hell MSMEs operators understand the tax and customs ecosystem in particular if they intend to get into import and export business.

This is in addition to market place and networking alternatives by its taxpayers’ roundtables that the taxman organizes to deliver with each other companies for purposes of sharing troubles influencing them and obtaining business information in line with the core company of the authority.

It is through these meetings that the Authority avails prospects for entrepreneurs to community and even set up new markets.

Import and export incentives

As a little small business operator, your intention is to develop from serving the regional men and women to accomplishing company globally. No business enterprise operator would their undertaking continue being stagnant therefore the will need for registration.

MSMEs registered with the taxman stand the probability of obtaining import incentives that contain lessened import tariffs on inputs these kinds of as machinery and uncooked resources to spur production of items for export in which the authority presents free of charge VAT for its associates.

The taxman also has a provision for money allowances on set up machinery and a feasible 20 % export payment arrangement.

Several enterprise chances

Did you know? In line with the govt directive on general public procurement, 30 per cent of all procurement at KRA goes to enterprises operate by the youth, women, and people today with disabilities which are mostly MSMEs. A further purpose why you have to have to sign up as a smaller small business operator.

Unregistered enterprises ought to sign-up as taxpayers in order to open doors to business enterprise opportunities that can only be accessed as soon as the organization acquires the all-vital PIN number.