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Guide · Kenya · 9 min read

KRA eTIMS expense validation in 2026: which expenses will iTax accept?

From the 2026 year of income, iTax checks the expenses in your return against the eTIMS invoices KRA holds. What a valid invoice shows, which expenses are exempt, what to do when a supplier won't issue one, and a 15-minute monthly routine.

By the Hesafi teamPublished Updated Adviser review pending

Jump to the routine
A receipt validator: a receipt slides under a brass loupe into the reader, and the needle of the meter on its front settles at 6 of this month's 12 purchases, the ones still missing their eTIMS details, as the clay lamp blinks.
[From]
1 Jan 2026
iTax checks declared expenses against eTIMS
[Exempt]
8 kinds
of expense on KRA's exempt list, so far
[Approval]
30 days
for a seller to approve a buyer-initiated invoice
[Routine]
15 min
a month, our estimate, keeps your evidence up to date

In short

From the 2026 year of income, iTax checks the expenses in your return against eTIMS invoices that KRA holds. An expense without a valid eTIMS invoice carrying your KRA PIN may not be allowed, unless it is on KRA's exempt list. Collect the invoices as you buy, not at filing time.3

What changed in 2026?

The Finance Act 2023 changed the Income Tax Act so that business expenses are deductible only when they are backed by an electronic tax invoice from eTIMS (or the older TIMS), with some exceptions.57 From 1 January 2026, KRA validates the income and expenses you declare in your return against eTIMS invoices, withholding-tax records and customs data for imports.3

KRA allowed some flexibility on unsupported expenses for the 2025 year of income. Its notice of 8 June 2026 says that ends: from the 2026 year of income, every expense you declare must be backed by an eTIMS invoice, with your PIN where it applies.4 News reports described the flexibility as a one-off too, so plan for strict checks on your 2026 expenses.6

Who does this affect?

Anyone carrying on business who files a return: sole proprietors, partnerships and companies, including small businesses on turnover tax (whose declared sales are checked too). If you buy stock, pay rent or hire services for your business, this affects you.

  • Sole proprietors
  • Partnerships
  • Companies
  • Turnover-tax businesses (sales checked)

What does a valid eTIMS invoice show?

Look for these six things on every eTIMS invoice you receive.

  1. The supplier's KRA PIN and name.
  2. Your KRA PIN as the buyer. Without it, the invoice isn't linked to you.
  3. An eTIMS invoice number.
  4. A QR code.
  5. The date.
  6. What you bought and the amount, including VAT where it applies.

Scan the QR code or use KRA's invoice checker to confirm an invoice is real before you rely on it.1

Wanjiru's month so farfictional

KES 62,000 not backed of KES 182,000.

Which expenses don't need an eTIMS invoice?

KRA's notice lists exceptions. As summarised by BDO East Africa, they include:5

Invoice

Needs an eTIMS invoice with your PIN

Most purchases from businesses: stock, rent, services.

Exempt

On KRA's exempt list3

  • Salaries, wages and other employee pay
  • Imports (supported by customs entries instead)
  • Interest
  • Investment allowances
  • Airline tickets
  • Payments that are subject to final withholding tax
  • Internal accounting adjustments, such as depreciation
  • Fees charged by financial institutions
  • Anything else KRA gazettes later

Unregistered seller

Seller isn't registered

A farmer, a tradesperson, a vegetable seller, a motorbike delivery rider. Raise a buyer-initiated invoice (section 05).

Check KRA's current list before you file: it can change.

Wanjiru's month so farfictional

KES 47,000 not backed of KES 182,000.

What if a supplier won't give you one?

Most businesses that sell to you should be issuing eTIMS invoices. Ask them, in writing, for an invoice with your KRA PIN on it, and keep the reply.

If the seller isn't registered (a farmer, a tradesperson, a vegetable seller), KRA's buyer-initiated invoicing lets you, the buyer, raise the invoice on KRA's eTIMS channels, including *222#, for a seller whose turnover is KES 5 million or less. The seller then gets an SMS and approves it. KRA's guidance gives the seller 30 days; an invoice that isn't approved lapses.2

  1. Day 0: you raise it on eTIMS or *222#
  2. The seller gets an SMS and approves it
  3. Day 30: not approved? It lapses.

Check KRA's current buyer-initiated invoicing guidance for the exact steps.2

Wanjiru's month so farfictional

KES 135,000 backed; KES 47,000 waiting on her suppliers.

A 15-minute monthly routine

Once a month, while the purchases are fresh. Every step works on paper too, with the printable worksheet.

Every month, about 15 minutes

7 steps
  1. List this month's business purchases from your M-PESA statement, bank statement and receipts.
  2. Next to each, write the supplier's KRA PIN and eTIMS invoice number.
  3. Scan or check any invoice you aren't sure about.
  4. Message each supplier whose invoice is missing or doesn't show your PIN.
  5. For unregistered sellers, raise buyer-initiated invoices and follow up the approvals before 30 days pass.
  6. Mark expenses on the exempt list, such as wages.
  7. Add up what is still missing. That's the amount at risk this month.

Step 1 is faster with our free M-PESA statement to Excel tool. It runs in your browser; your statement is never uploaded. Open the tool

A worked example: Wanjiru's month

Wanjiru runs a fictional shop in Kasarani, Nairobi. These are her business purchases for one month:

PurchaseAmountEvidence
Stock from a wholesalerKES 120,000Backed: eTIMS invoice with her PIN
Vegetables from a farmerKES 18,000Not backed: No invoice: farmer isn't registered
Shop rentKES 25,000Not backed: Landlord hasn't sent an eTIMS invoice
Wages for her shop assistantKES 15,000Backed: Employee pay: on the exempt list
Deliveries by a motorbike riderKES 4,000Not backed: No invoice: rider isn't registered
Not backedKES 47,000of KES 182,000
KES 135,000 of KES 182,000 is backed by evidence; KES 47,000 is not.

If none of the three is fixed by the time she files, KES 47,000 of her expenses may not be allowed, so her taxable profit would be KES 47,000 higher. This month she raises buyer-initiated invoices for the farmer and the rider, and asks her landlord for an eTIMS invoice for the rent.

How Hesafi helps

Hesafi doesn't issue eTIMS invoices or file returns. It keeps the records iTax checks, purchase by purchase, so the routine above takes minutes.

  • Supplier PIN and eTIMS invoice number on every purchase

    Available now

    Save the supplier's KRA PIN and eTIMS invoice number with each expense. Hesafi checks their format and flags purchases missing them, before you file.

  • Ask suppliers for the missing invoice on WhatsApp

    Available now

    One tap writes a polite message asking the supplier for an eTIMS invoice with your PIN on it. You send it from your own WhatsApp.

  • Buyer-initiated invoice tracker

    Available now

    Buy from farmers, tradespeople or market vendors? You raise a buyer-initiated invoice on KRA's own channels; Hesafi tracks each one, counts down the 30 days the seller has to approve it, and reminds you on day 20.

  • Purchases CSV for iTax

    Beta

    Export the month's purchases that have a checked eTIMS invoice and supplier PIN as a CSV, with a note of what was left out and why.

    The file layout is still being checked against what iTax expects. Check it against the current iTax template before you upload.

  • eTIMS Expense Shield

    Beta

    A meter that shows how many of this month's purchases are checked, how much spending iTax may not accept, and the extra income tax that gap could cost, so you can chase suppliers while there's still time.

    The extra-tax figure is an estimate while a qualified adviser checks this year's rates.

Sample screen

Start free

Supplier PIN and eTIMS fields are part of Standard: KES 3,500 once, with a 30-day money-back. See pricing

Questions people ask

Is an M-PESA confirmation message enough proof of an expense?

No. It proves you paid; it isn't an eTIMS invoice.

For an expense to count, KRA expects an eTIMS invoice from the supplier (or an approved buyer-initiated invoice), unless the expense is on the exempt list.

Can Hesafi issue eTIMS invoices for me?

No. Use KRA's free eTIMS tools.

Hesafi doesn't issue or submit eTIMS invoices and doesn't file returns. Use KRA's free eTIMS tools to issue invoices. Hesafi keeps the supplier PIN and invoice number for each purchase and shows which ones are missing.

Does this apply to me if I pay turnover tax?

Your sales are checked; expenses don't reduce turnover tax.

Turnover tax is charged on your sales, so expenses aren't deducted from it. But the 2026 checks also compare the sales you declare with eTIMS and withholding-tax data, so keeping clean records still matters.

What if my supplier refuses?

Ask in writing, and keep the reply.

A WhatsApp message is fine. If the seller isn't registered at all, such as a farmer, use buyer-initiated invoicing. Talk to a tax adviser before you file if large expenses still have no invoice.

Words used in this guide

eTIMS
KRA's electronic Tax Invoice Management System.
iTax
KRA's online system for filing returns.
KRA PIN
Your tax Personal Identification Number.
Buyer-initiated invoice
An eTIMS invoice raised by the buyer when the seller isn't registered; the seller approves it.
Turnover tax
A tax on the sales of small businesses.
Withholding tax
Tax deducted at source by the payer.

Sources

  1. Kenya Revenue Authority

    Learn about eTIMS (FAQs) (opens in a new tab)

    Checked

    Used for: What eTIMS is, and checking that an invoice is real (scan its QR code, or the invoice number checker on iTax).

    Back to the text, where source 1 is first cited

  2. Kenya Revenue Authority

    Buyer-initiated invoicing (opens in a new tab)

    Checked

    Used for: How a buyer raises the invoice, for sellers with turnover up to KES 5 million, the *222# channel, the seller's SMS approval and the 30 days.

    Back to the text, where source 2 is first cited

  3. Kenya Revenue Authority, public notice

    Validation of income and expenses in the income tax returns (opens in a new tab)

    Published · Checked

    Used for: The checks against eTIMS from 1 January 2026, and the notice's list of exceptions.

    Back to the text, where source 3 is first cited

  4. Kenya Revenue Authority, public notice

    Filing of 2025 income tax returns (opens in a new tab)

    Published · Checked

    Used for: The flexibility on unsupported expenses for the 2025 year of income, and that it ends with the 2026 year of income.

    Back to the text, where source 4 is first cited

  5. BDO East Africa

    KRA to validate income and expenses declared in tax returns effective 1 January 2026 (opens in a new tab)

    Checked

    Used for: The Finance Act 2023 change, and the exempt list as summarised here.

    Back to the text, where source 5 is first cited

  6. Khusoko

    eTIMS expenses and the 2025 income tax returns (opens in a new tab)

    Published · Checked

    Used for: News reports describing the 2025 flexibility as a one-off.

    Back to the text, where source 6 is first cited

  7. Techweez

    KRA's eTIMS digital tax rules (opens in a new tab)

    Published · Checked

    Used for: The rules in plain terms.

    Back to the text, where source 7 is first cited

Hesafi is not affiliated with KRA. This guide is general information, not tax advice.

What changed in this guide

  • Added KRA's own public notices and eTIMS FAQs as sources, and KRA's notice of 8 June 2026 that the 2025 flexibility ends.
  • First published.

Keep the records iTax checks.

Save the supplier PIN and eTIMS invoice number with every purchase, and see what's missing before you file. These fields are part of Standard, KES 3,500 once. Start free.

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