VAT Settings

This section will give you a brief overview about how you can configure and add VAT in Zoho Books.

Configure VAT in Zoho Books

You’ll have to configure your VAT settings by enabling VAT and setting up VAT rates in Zoho Books to get started. Here’s how:

Enable VAT Settings

To enable VAT settings for your organisation in Zoho Books:

Go to Settings.
Under Organisation Settings, select VAT under Taxes & Compliance.
Select VAT Settings in the Taxes pane.
Enter the VAT Registration Number (your KRA PIN) and click Validate PIN to authenticate your PIN with the Kenya Revenue Authority.

For VAT-registered businesses:

Enable the Is your business registered for VAT? toggle, and fill in the following details:
- If your business involves international trade (import or export outside Kenya), check the Enable trade with contacts outside Kenya option.
- Enter your VAT Registered On date.
- Select when you want to Generate First Tax Return From.
- Select the required Reporting Period.
Click Save.

VAT will be enabled for your organisation.

For non-VAT registered businesses:

Disable the Is your business registered for VAT? toggle.
Click Save.

Add VAT Rate

If your organisation is registered for VAT, the three default VAT rates will be auto-populated.

General Rate (16%)
Reduced Rate (8%)
Zero Rate (0%)

To create or add a new VAT Rate:

Go to Settings.
Under Organisation Settings, select VAT under Taxes & Compliance.
Click VAT Rates.
Click + New VAT.
Enter the VAT Name and Rate (%).
Click Save.

Populate VAT Rates for Non-VAT Registered Organisations

If your organisation is not registered for VAT, you will not have the option to create taxes manually. Instead, you can populate the standard Kenya VAT rates directly. To do this:

Go to Settings.
Under Organisation Settings, select VAT under Taxes & Compliance.
Click VAT Rates.
Click Populate VAT Rates.

The default Kenya VAT rates (General Rate 16%, Reduced Rate 8%, and Zero Rate 0%) will be auto-populated in your organisation. You can then select the appropriate VAT rate while creating purchase transactions.