The Electronic Tax Invoice Management System (E-TIMS) is a digital invoicing solution introduced by the Kenya Revenue Authority (KRA) to streamline tax compliance. It ensures that all business transactions are captured in real time, enhancing accuracy in tax declarations. For small businesses, adopting E-TIMS is not only a legal requirement but also a way to improve financial record keeping and build credibility with suppliers and clients.
Understanding E-TIMS
E-TIMS is a simplified version of the traditional Tax Invoice Management System (TIMS). Unlike TIMS, which relies heavily on physical Electronic Tax Registers (ETRs), E-TIMS allows businesses to generate e-invoices through devices, web applications, and software integrations. Its key features include:
- Real-time invoice transmission to KRA.
- Multiple access options (desktop app, web portal, mobile app, or APIs).
- Automated generation of VAT return data.
This makes E-TIMS flexible and more accessible for small businesses with limited resources.
Eligibility and Requirements
All VAT-registered businesses are legally required to onboard E-TIMS. However, even non-VAT-registered businesses may adopt it voluntarily for proper record keeping and compliance. To get started, a business needs:
- A valid KRA PIN.
- An active iTax account.
- Basic business details (registration documents, business permits, contact information).
- A stable internet connection and a device (computer or smartphone).
Registration Process
The onboarding process begins on the KRA iTax portal:
- Log in using your KRA PIN and password.
- Navigate to the E-TIMS registration option.
- Fill in the onboarding application form with required details.
- Submit the application for KRA review and approval.
- Once approved, you will be issued credentials to access the E-TIMS system.
This process ensures that the business is officially linked to KRA’s invoicing infrastructure.
System Setup and Integration
After registration, the business must set up the system. Small businesses can choose from:
- E-TIMS Web Portal – accessed directly online.
- E-TIMS Mobile App – for smartphones.
- Desktop Application – for computers.
- System-to-System API Integration – for businesses with accounting software.
Once installed, the business should link its records to E-TIMS and perform a test run to confirm that invoices are correctly transmitting to KRA.
User Training and Orientation
Successful onboarding requires that staff understand how to operate E-TIMS. Training should cover:
- Logging into the system.
- Creating, editing, and sending invoices.
- Checking invoice status.
- Handling common errors such as rejected invoices.
KRA and authorized service providers often provide user manuals and training sessions to support businesses during this phase.
Issuing and Managing E-Invoices
With E-TIMS, every sale must be accompanied by an e-invoice. The process involves:
- Entering transaction details (buyer info, goods/services, VAT, totals).
- Generating the e-invoice with a unique Invoice Number (PIN QR code).
- Sending the invoice to the customer via printout, email, or SMS.
The system also stores these invoices automatically, making record keeping seamless.
Compliance and Reporting
E-TIMS simplifies compliance by ensuring that all sales data is captured and transmitted to KRA. Benefits include:
- Automatic generation of VAT return data.
- Elimination of mismatched supplier declarations.
- Reduced errors in filing returns.
By using E-TIMS consistently, businesses minimize risks of penalties and maintain a clean compliance record.
Benefits of E-TIMS for Small Businesses
Adopting E-TIMS offers significant advantages, such as:
- Efficiency – less paperwork and faster invoicing.
- Transparency – real-time reporting enhances trust with customers and suppliers.
- Improved record keeping – all invoices are stored digitally.
- Compliance profile – businesses appear credible when seeking contracts, loans, or government tenders.
Challenges and Solutions
Small businesses may face hurdles when adopting E-TIMS, including:
- Technical issues – software glitches or device incompatibility.
- Connectivity problems – especially in areas with poor internet.
- Knowledge gaps – staff may initially struggle to adapt.
Solutions include seeking support from KRA helpdesks, using mobile-based E-TIMS apps where internet is unstable, and scheduling staff training.
Conclusion
E-TIMS represents the future of tax compliance in Kenya. For small businesses, onboarding early provides long-term benefits in efficiency, transparency, and financial management. By embracing E-TIMS and following best practices, businesses not only avoid penalties but also strengthen their operational credibility and growth prospects.
