Where a Kenyan business needs its KRA PIN
The transactions for which KRA says a Kenyan business needs a PIN, who must register, what happens if it never does, and keeping PINs tidy.
By Achekam · · 4 min read · For Running a business businesses in Kenya
In Kenya a KRA PIN works less like a tax number and more like a key. The bank asks for it before opening an account. The county asks for it before issuing a trade licence. Safaricom asks for it before giving the business a paybill. A business without one, or with one recorded wrongly, finds doors closing at awkward moments.
This article lists the transactions KRA connects to the PIN, explains who must register and what happens to those who do not, and ends with a short routine for keeping your own PIN, and other people's, in order.
The transactions KRA lists
KRA's PIN registration page says a PIN is required for a range of transactions. Grouped by the stage of a business's life, they include:
Setting up
- registering a business name or company;
- trade licensing;
- opening accounts with financial institutions.
Trading
- importing and customs clearing;
- contracts to supply government ministries and public bodies;
- registering M-PESA pay bill and till numbers with telecom operators;
- doing business over the internet or a digital marketplace.
Assets and services
- registering land titles and stamping instruments;
- motor vehicle registration and transfer;
- insurance underwriting;
- power connection deposits.
People
- professional body membership.
The list is not a set of tax returns. It is a set of everyday dealings, which is why the PIN tends to be needed long before the first return is due. If the business plans to collect by M-PESA, the paybill application is one of the first places the PIN will be asked for; see applying for an M-PESA paybill.
Who must apply
KRA says a person who has accrued or expects to accrue a tax liability under the Income Tax Act or the VAT Act, or who expects to manufacture or import excisable goods or supply excisable services, must apply to the Commissioner to be registered.
"Expects to" is the important phrase. The duty arises from what the business is about to do, not only from what it has already done. A company that will trade, employ or import should apply at the start; getting a KRA PIN for a company or partnership explains the online application.
Refusals, and registration without an application
KRA says that if the Commissioner refuses to register an applicant, the Commissioner must inform the applicant in writing within fourteen days of the decision. A refusal is therefore never silent: if you hear nothing, follow up on the application rather than assume it failed.
The same page says the Commissioner may register, on his own motion, a person who should have applied but did not. Staying off the register is not a way of staying invisible. KRA can put the business on the register itself, and the business then deals with KRA on KRA's timetable rather than its own.
The penalty for PIN offences
KRA's list of business offences says PIN-related offences attract a penalty of Ksh 2,000 per offence. The words "per offence" matter: repeated failures are counted one by one. Check KRA's penalties page for the current position at the time you need it.
Customer and supplier PINs in Achekam, and where it falls short
PINs matter in both directions. Your VAT-registered customers need their PIN on your invoices, because KRA says an input tax claim requires a valid electronic tax invoice showing the buyer's PIN. And you need your suppliers' PINs right for the same reason in reverse.
Achekam keeps one supplier list for a business, with duplicate checks by name or VAT number, and quotations, orders and bills pick suppliers from it. That stops the same supplier being created twice under slightly different names.
There are limits a Kenyan business should know about today:
- A supplier's VAT number must be in the South African format, so Kenyan VAT numbers are refused in that field.
- Where Achekam asks for a KRA PIN, it checks only the shape (a letter, 9 digits, a letter) as a soft check. It cannot confirm that the PIN is real or belongs to that supplier; a person confirms that on iTax's PIN checker and records the evidence.
Until the supplier record accepts Kenyan numbers, keep each supplier's PIN certificate and the result of your PIN check in Document Centre, Achekam's folder-based store, tagged with the supplier's name so it can be found by search.
KRA's buyer-initiated invoicing guidelines describe a valid PIN as 11 characters: A for individuals and sole proprietors or P for companies, then 9 digits, then a letter, as in P123456789Z. That gives a quick eyeball test: a limited company whose PIN starts with A deserves a second look.
A PIN housekeeping checklist
- Keep the business's own PIN certificate where everyone who invoices or signs contracts can reach it.
- Check every new supplier's PIN on iTax's PIN checker before the first bill is entered, and file the result.
- Compare the first letter of each PIN with the type of entity you are dealing with.
- Re-check a supplier's PIN when it changes its name or structure.
- Ask VAT-registered customers for their PIN when you open their account, so it appears on every invoice.
- Review the supplier list for near-duplicates twice a year.
Checking a supplier's tax standing goes further than its PIN; checking a supplier's tax compliance covers the next step.
KRA's page on PIN registration for companies and partnerships sets out who must register, the thirty-day deadline, what the application needs and the full list of transactions that require a PIN.
General guidance only, not advice on your own circumstances. Tax and payroll rules change: check the current position with the authority or your adviser.
