Benefits Of Registering As A Taxpayer If You’re A Small Business Operator In KenyaKuza Blog
In his Eighth Condition of the Nation Address on 30th Nov this year, President Uhuru Kenyatta submitted a report to the parliament recognizing Micro, Tiny, and Medium Enterprises (MSMEs) as the lifeblood of Kenya’s financial state however a substantial selection of them are unlicensed.
In accordance to the 2017 Economic Study, there are about 1.56 million licensed MSMEs and 5.85 million unlicensed identical enterprises in Kenya.
This usually means that significantly less than 27 % of all organizations in Kenya are registered. Out of these, 92.2 percent are micro-enterprises whilst only 7.1 p.c and .7 p.c are little and medium enterprises respectively.
The explanation some of the MSME operators give for not registering their organizations is that they anxiety becoming subjected to high taxation that could conclusion up consuming on their gain.
On the other hand, as you will soon discover, there are several advantages that await unregistered MSME operators as taxpayers that which include financial loans and authorities expert services.
Bid for govt contracts
As a registered modest organization operator as a taxpayer, you will be putting yourself in the ideal posture to bid and win government tenders and trade with the authorities and non-federal government establishments.
If your business is not registered, you are unable to bid for govt contracts or even spouse with other firms to acquire gain of communal gains which includes important networks, primarily with more substantial companies with who they could even enter into sub-contracts.
Thus, you will repeatedly be locked out of valuable enterprise associations. Merely set, if an enterprise is not a taxpayer it simply cannot grow!
Customized tax and customs advisory companies
These are providers made available by the Kenya Revenue Authority (KRA) through its wide community, social media, and telephony amongst many others to hell MSMEs operators have an understanding of the tax and customs natural environment specially if they intend to get into import and export company.
This is in addition to current market and networking chances via its taxpayers’ roundtables that the taxman organizes to bring alongside one another organizations for functions of sharing issues influencing them and obtaining business suggestions in line with the main company of the authority.
It is for the duration of these meetings that the Authority avails chances for entrepreneurs to network and even set up new markets.
Import and export incentives
As a little enterprise operator, your aim is to expand from serving the community folks to doing business enterprise globally. No business enterprise operator would their venture remain stagnant that’s why the need to have for registration.
MSMEs registered with the taxman stand the likelihood of acquiring import incentives that include things like reduced import tariffs on inputs such as machinery and uncooked elements to spur production of merchandise for export in which the authority gives cost-free VAT for its associates.
The taxman also has a provision for money allowances on mounted machinery and a possible 20 % export payment arrangement.
Numerous enterprise prospects
Did you know? In line with the govt directive on general public procurement, 30 p.c of all procurement at KRA goes to enterprises run by the youth, girls, and persons with disabilities which are mainly MSMEs. A different motive why you require to sign-up as a small enterprise operator.
Unregistered enterprises should register as taxpayers in get to open up doors to enterprise alternatives that can only be accessed after the small business acquires the all-critical PIN amount.
