Introduction
This post addresses the question; what items are not included when determining the amount of a supply to be charged VAT in Kenya?
Items excluded
Some items are excluded when determining the amount of a supply to levy VAT on. This list is according to the date of this post. The following items are excluded from consideration in a supply for VAT purposes in Kenya:
- The financial charge for goods sold on credit.
- Interest for late payment.
- Tourism levy.
- Service charge in lieu of tips in hotels and restaurants. There are two conditions for this exclusion:
- There must be an agreement in place.
- The service charge must be less than 10% of the bill amount less the service charge.
- Output VAT.
- Exempt supplies.
This list is not complete; the tax Commissioner may exclude other items.
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