If you’ve been hearing whispers about the “VAT Special Table” from accountants or in investor circles, you’re not alone.
In simple terms, the VAT Special Table is a list maintained by KRA that flags businesses with suspicious VAT behavior. Think of it like a tax “watchlist.” You’re not blacklisted but if your business shows up here, some important things stop working until you fix the issue.
Why Would a Business End Up on the VAT Special Table?
KRA’s been tightening its systems, especially around VAT. And if you’re doing business in Kenya, this is what could land you or a company you’re investing in on the list:
1. You’ve Been Filing VAT Returns But Not Paying
If a company keeps declaring tax owed month after month, but never actually pays, KRA flags that. Especially if there’s no payment plan or explanation.
That’s called “PRWP” Payment Returns Without Payment. It’s one of the most common triggers.
2. You Stopped Filing VAT for 6+ Months
If your business is VAT-registered, KRA expects you to file every month even if you had no sales. Go quiet for too long, and you’ll raise red flags.
3. You Keep Saying ‘Zero Sales’ But Other People Are Claiming VAT From You
Now this one’s serious. If you’re filing nil returns but KRA sees other businesses trying to claim input VAT from your PIN? Something’s not adding up.
That kind of mismatch screams “ghost trader” even if it’s a mistake.
4. You’re Not Using eTIMS
Kenya’s VAT system has gone digital. KRA wants everyone using the eTIMS platform to issue VAT-compliant receipts. If you haven’t onboarded or are still using old ETRs you might get listed for non-compliance.
5. You’ve Been Flagged as a ‘Missing Trader’
This is as bad as it sounds. It usually means KRA thinks you’re issuing fake invoices, or your books don’t match your actual activity. It might also mean your listed business isn’t even operational.
What Happens If You’re On the List?
Let’s say you’re flagged either as a business owner or you discover a company in your portfolio is affected. Here’s what it means:
- •You can’t file VAT returns until you clear it with KRA.
- •Other businesses can’t claim VAT from your invoices. Their system will reject your PIN.
- •Your invoices lose credibility. Even if you paid tax, no one can rely on your documents.
- •You’ll need to engage KRA directly no more online fixes. Your case is handled manually.
It’s not a total shutdown but it’s a big red tape moment.
How Do You Fix It?
You or your finance team will need to do three things:
- •Visit your Tax Service Office (TSO).
- •Bring documentation Tax returns, payment slips, business licenses, proof you’re on eTIMS, etc.
- •Clean up your filings and update your systems If you haven’t adopted eTIMS yet, you’ll need to. If your filings were wrong, you may need to amend or explain them.
Why Should Investors Care?
As an investor, the VAT Special Table is something to ask about especially in due diligence. Why?
- •It affects credibility. If a business can’t issue usable VAT invoices, clients and suppliers may walk away.
- •It signals cash flow or reporting issues. Businesses on the list often have irregular tax behavior.
- •It might slow down public sector deals. Government and parastatal buyers check VAT compliance.
- •It could indicate risk of audits or penalties.
In other words it’s more than a tax problem. It’s a trust problem.
So, How Do You Stay Off the VAT Special Table?
Here’s what businesses should be doing right now:
- •File your VAT returns on time, even if it’s nil
- •Pay or at least talk to KRA if you can’t
- •Register for and actively use eTIMS
- •Keep your invoices clean, consistent, and verifiable
- •Avoid claiming or processing invoices from flagged businesses
If you’re unsure use KRA’s invoice checker to verify what’s acceptable.