Claiming VAT paid at customs on imports
How a Kenyan importer claims the VAT it paid at customs, which customs entries count, what records to keep, and a monthly review before the VAT return.
By Achekam · · 4 min read · For Running a business businesses in Kenya
When goods arrive at Mombasa or JKIA, VAT is paid before they are released. For a VAT-registered importer, that VAT is not meant to be a cost: it is input tax, to be set against the output VAT the business charges when it sells the goods. But the claim only works if the right document backs it, and for imports that document is not an eTIMS invoice.
Importers who treat customs VAT like any other purchase VAT can find their claims rejected or delayed. This article explains which customs entries KRA accepts, what to keep, how to check an entry's status, and how to record the VAT properly in your books.
Only validated customs entries count
KRA allows input VAT to be claimed on validated customs import entries. Those sit alongside the other documents KRA accepts: eTIMS invoices transmitted with the buyer's PIN, and supplies from non-resident digital suppliers who put the buyer's PIN on a line item.
KRA's wider conditions apply to customs entries too. It says an input tax claim needs a valid electronic tax invoice or customs entry that shows the buyer's PIN and was transmitted to KRA. For an importer, that means checking the customs entry shows the business's own PIN, not the clearing agent's.
KRA's guidance on understanding VAT input tax deduction sets out the documents an input tax claim must rest on, including customs entries. For the full set of conditions on any input VAT claim, see conditions for claiming input VAT.
Settled or removed status
Not every customs entry is ready to be claimed. KRA says input VAT can be claimed on validated customs import entries whose status is settled or removed. An entry still being processed, or one with an outstanding query, is not yet there.
This matters for timing. If you file your VAT return before an entry reaches settled or removed status, leave it out and claim it once it does. How claims flow through the pre-filled return is covered in the VAT auto-populated return.
Checking a declaration's status
KRA's GavaConnect developer platform lists a customs declaration status checker among its APIs, together with an import certificate checker. A business with its own systems, or a clearing agent, can use these to confirm where an entry stands. A smaller importer can ask its clearing agent to confirm the status before the VAT return is prepared.
Build the check into your month-end: no entry goes into the VAT claim until someone has confirmed it is settled or removed.
Keeping customs entries with your VAT records
The VAT Act, as published on Kenya Law in the version dated 1 July 2026, requires a full and true record of every transaction to be kept for five years from the date of the last entry. It lists what that record includes, and customs entries are named expressly, alongside purchase invoices, tax invoices, credit and debit notes and stock records. The records can be kept in English or Kiswahili, in electronic or other form.
So the customs entry is not a clearing agent's document to be left in their files. Get a copy for every shipment and keep it with your own VAT records. From September 2026, importers must also keep an export document from the country of origin; see export documents importers must now keep.
Recording imports in Achekam, and its purchase VAT limit
In Achekam, a business records supplier bills line by line with VAT. A bill without a purchase order waits for approval before it posts, and it can be paid in full or in parts from a chosen bank account. The overseas supplier's invoice is recorded as a bill in the usual way.
The customs VAT needs more care, because of a current limitation. Supplier bills and purchase orders do not use a Kenyan business's own VAT rate: they offer 15% or 0% and default to 15%. KRA says Kenya's general VAT rate is 16%. So a bill cannot carry Kenyan import VAT at the right rate.
Until that changes, a sound approach is:
- Record the overseas supplier's bill at 0% VAT, since its invoice carries no Kenyan VAT.
- Record the VAT paid at customs with a manual journal, debiting input VAT and crediting the bank or the clearing agent, with the customs entry number in the narration.
- Keep the customs entry with the journal.
Manual journals that do not balance, or that fall in a closed month, are refused, and a posted journal is corrected only by a reversal, which keeps the trail intact.
Achekam also lists a Kenyan business's supplier invoices with no eTIMS reference recorded. Import bills carry a customs entry rather than an eTIMS reference, so expect them on that list and review them separately rather than chasing the supplier for an eTIMS invoice it cannot issue.
A monthly import VAT review
- List every import cleared in the month, with its customs entry number.
- Confirm each entry is in the business's own name and PIN.
- Check each entry's status is settled or removed.
- Agree the VAT on each entry with the journal posted in the books.
- Carry forward entries not yet settled, with a note to claim them later.
- File the customs entries and export documents with the month's VAT records.
Ask your clearing agent this week to send you a copy of every customs entry as a matter of routine. The claim depends on a document that too often stays in someone else's files.
General guidance only, not advice on your own circumstances. Tax and payroll rules change: check the current position with the authority or your adviser.
