Benefits Of Registering As A Taxpayer If You’re A Small Business Operator In KenyaKuza Blog
In his Eighth Condition of the Country Handle on 30th Nov this 12 months, President Uhuru Kenyatta submitted a report to the parliament recognizing Micro, Small, and Medium Enterprises (MSMEs) as the lifeblood of Kenya’s economy still a enormous range of them are unlicensed.
According to the 2017 Economic Survey, there are about 1.56 million licensed MSMEs and 5.85 million unlicensed related businesses in Kenya.
This suggests that considerably less than 27 per cent of all enterprises in Kenya are registered. Out of these, 92.2 % are micro-enterprises whilst only 7.1 % and .7 % are smaller and medium enterprises respectively.
The rationale some of the MSME operators give for not registering their corporations is that they concern becoming subjected to high taxation that may well close up having on their revenue.
Nonetheless, as you will soon explore, there are several advantages that await unregistered MSME operators as taxpayers that which includes financial loans and govt products and services.
Bid for authorities contracts
As a registered modest company operator as a taxpayer, you will be placing you in the very best place to bid and get government tenders and trade with the governing administration and non-authorities institutions.
If your organization is not registered, you are not able to bid for governing administration contracts or even lover with other firms to choose edge of communal advantages which include critical networks, in particular with bigger providers with who they could even enter into sub-contracts.
As a result, you will continually be locked out of helpful business associations. Basically set, if an company is not a taxpayer it simply cannot improve!
Individualized tax and customs advisory solutions
These are services offered by the Kenya Income Authority (KRA) as a result of its wide network, social media, and telephony between some others to hell MSMEs operators understand the tax and customs ecosystem specifically if they intend to get into import and export business.
This is in addition to sector and networking prospects by its taxpayers’ roundtables that the taxman organizes to carry alongside one another corporations for purposes of sharing troubles impacting them and obtaining company information in line with the main company of the authority.
It is through these meetings that the Authority avails possibilities for business people to community and even establish new markets.
Import and export incentives
As a smaller business operator, your objective is to mature from serving the area men and women to undertaking enterprise globally. No organization operator would their enterprise continue being stagnant that’s why the have to have for registration.
MSMEs registered with the taxman stand the probability of obtaining import incentives that consist of lessened import tariffs on inputs this sort of as machinery and raw resources to spur manufacturing of merchandise for export exactly where the authority offers free of charge VAT for its members.
The taxman also has a provision for money allowances on mounted machinery and a achievable 20 % export payment arrangement.
A lot of enterprise possibilities
Did you know? In line with the government directive on general public procurement, 30 percent of all procurement at KRA goes to enterprises operate by the youth, females, and people with disabilities which are primarily MSMEs. Yet another motive why you need to sign up as a modest business operator.
Unregistered enterprises should register as taxpayers in buy to open doors to small business options that can only be accessed when the company acquires the all-vital PIN amount.
