Inventory
VAT in Transactions
Using Zoho Inventory, you can create VAT-compliant sales and purchase transactions. Each of these transactions are VAT-compliant i.e. different VAT treatments can be applied while creating transactions.
Once you have enabled taxes, added your customers, vendors, and items to your Zoho Inventory organisation, you can start creating VAT-compliant transactions.
Zoho Inventory will auto-create the following VAT Rates once you enable VAT in your organisation:
- General Rate - 16%
- Reduced Rate - 8%
- Zero Rated for Supplies - 0%
- Exempt
| VAT Treatment | VAT Rate in Sales | VAT Rate in Purchases |
|---|---|---|
| VAT Registered |
|
|
| Non VAT Registered |
|
|
| Non-Kenya |
|
Note: VAT rate will be applicable only if a Bill of Entry or E-slip is associated with the transaction. If not, it’ll be Out of Scope. |
VAT in Sales Transactions
VAT Registered
Let’s say you sell your goods or services to a VAT-registered customer who resides in Kenya, you can apply one of the following rates:
- General Rate
- Reduced Rate
- Zero Rate
- Exempt
Non VAT Registered
Non VAT registered customers are those whose business location is in Kenya but are not VAT registered. For such customers, you can apply one of the following rates:
- General Rate
- Reduced Rate
- Zero Rate
- Exempt
Non-Kenya
Non-Kenya is a type of VAT treatment for customers who are outside Kenya. When you sell goods or services to such customers, you must apply Zero Rate on transactions.
VAT in Purchase Transactions
VAT Registered
If you purchase goods or services from a vendor who is VAT-registered and is located in Kenya, you can apply one of the following rates:
- General Rate
- Reduced Rate
- Zero Rate
- Exempt
Non Vat Registered
If you purchase goods or services from a vendor who’s business location is Kenya but is not VAT registered, then the supply of goods or services is Out of the Scope of VAT.
Non-Kenya
If you import goods or services from a vendor who is outside of Kenya you’ll have to create a Bill of Entry for goods or E-slip for services from a non-Kenya vendor. In such cases, you can apply one of the following rates on the transaction:
- General Rate
- Reduced Rate
- Zero Rate
Bill of Entry will be applicable when you import goods from your vendors and E-slip when you purchase a service from a non-Kenya vendor.
