24/09/2024
It’s an undisputed fact that the backbone of our economy is bolstered by SME’s.
However, of key concern with most of them, is the Turn Over Tax (TOT). This tax was introduced by the Finance Act 2007 through the provision of the Income Tax Act, Cap 470, under section 12c as read with section 34.
Who is eligible?
Any resident person or corporate whose gross or expected turnover is more than Kshs. 1,000,000 but does not exceed or expected to exceed Kshs. 25,000,000 in any year of income, is eligible for Turnover Tax.
It is payable at the rate of 1.5% on gross sales effective from 1st of July 2023 as per the Finance Act 2023.
One of the benefits of compliance is that, apart from keeping the taxman at bay, you can do your business and file taxes on the go. Since you are only required to keep daily sales records, it reduces the complexity of record keeping in your business.
