Benefits Of Registering As A Taxpayer If You’re A Small Business Operator In KenyaKuza Blog
In his Eighth State of the Country Tackle on 30th Nov this 12 months, President Uhuru Kenyatta submitted a report to the parliament recognizing Micro, Little, and Medium Enterprises (MSMEs) as the lifeblood of Kenya’s economic system yet a substantial quantity of them are unlicensed.
According to the 2017 Financial Survey, there are about 1.56 million certified MSMEs and 5.85 million unlicensed comparable corporations in Kenya.
This signifies that much less than 27 per cent of all corporations in Kenya are registered. Out of these, 92.2 percent are micro-enterprises though only 7.1 percent and .7 percent are compact and medium enterprises respectively.
The cause some of the MSME operators give for not registering their firms is that they panic staying subjected to high taxation that may perhaps stop up feeding on on their income.
Even so, as you will soon find out, there are several rewards that await unregistered MSME operators as taxpayers that like financial loans and govt expert services.
Bid for government contracts
As a registered tiny company operator as a taxpayer, you will be placing on your own in the most effective position to bid and earn federal government tenders and trade with the government and non-authorities establishments.
If your business enterprise is not registered, you can not bid for government contracts or even partner with other businesses to just take edge of communal added benefits such as crucial networks, specifically with much larger companies with who they could even enter into sub-contracts.
For that reason, you will constantly be locked out of valuable business enterprise associations. Merely set, if an organization is not a taxpayer it are unable to develop!
Personalised tax and customs advisory products and services
These are services provided by the Kenya Profits Authority (KRA) via its broad network, social media, and telephony amongst other folks to hell MSMEs operators realize the tax and customs ecosystem primarily if they intend to get into import and export business enterprise.
This is in addition to market place and networking chances as a result of its taxpayers’ roundtables that the taxman organizes to bring jointly organizations for reasons of sharing troubles influencing them and getting business enterprise guidance in line with the core company of the authority.
It is throughout these meetings that the Authority avails prospects for entrepreneurs to community and even set up new marketplaces.
Import and export incentives
As a modest organization operator, your target is to expand from serving the regional folks to carrying out organization globally. No enterprise operator would their venture continue to be stagnant for this reason the will need for registration.
MSMEs registered with the taxman stand the opportunity of receiving import incentives that include lowered import tariffs on inputs this kind of as equipment and uncooked elements to spur manufacturing of goods for export exactly where the authority presents cost-free VAT for its members.
The taxman also has a provision for cash allowances on installed equipment and a attainable 20 p.c export payment arrangement.
Many enterprise prospects
Did you know? In line with the government directive on public procurement, 30 p.c of all procurement at KRA goes to enterprises run by the youth, ladies, and folks with disabilities which are predominantly MSMEs. One more cause why you want to sign-up as a little small business operator.
Unregistered enterprises really should sign-up as taxpayers in get to open doors to company chances that can only be accessed at the time the company acquires the all-vital PIN variety.