Charging VAT in Nigeria and Kenya while rates await approval

Why Achekam can refuse a standard-rated line on a Nigerian or Kenyan invoice, what the refusal means, and what a business should do in the meantime.

By Achekam · 11 October 2026 · 4 min read · For Running a business businesses in Nigeria, Kenya

You raise an invoice in Achekam for a VAT-registered Nigerian or Kenyan business. The line is an ordinary standard-rated sale. You choose the standard tax code, and the invoice is refused. The message names a rule that is not yet approved and tells you to choose a tax code without VAT, or wait.

It looks like a fault. It is a deliberate safeguard, and knowing why it is there tells you what to do next. This article explains the rates in law, why Achekam will not charge them until a rule is approved, and how to handle invoices in the meantime.

The rates in law at the time of writing

The standard VAT rates themselves are not in doubt:

So the refusal is not about what the rate is. It is about how Achekam decides it may charge a rate at all.

Why Achekam needs an approved rule before charging

Achekam takes the standard VAT rate for an invoice from the approved rule in force on the document's date in the issuing workspace's country. When no approved rule applies, it refuses rather than assumes a rate.

Every Nigerian and Kenyan tax figure in Achekam's rule book was loaded "under review". Achekam computes nothing from a figure until an Achekam platform administrator approves it, and no user at your business can change a rate. That is the safeguard: a rate typed wrongly into a rule book would otherwise be charged on every invoice, by every business, until someone noticed.

Once the Nigerian rule is approved, Achekam charges Nigerian VAT at 7.5% on standard-rated invoice lines. Once the Kenyan rule is approved, it charges Kenyan VAT at 16%. Until then, a standard-rated line is refused. Whether either rule has been approved yet is something you discover in the simplest way: a standard-rated line either goes through or it is refused.

The refusal and what it tells you

The refusal is reported as VAT_RATE_UNAVAILABLE, and it names the rule that is missing: VAT_STANDARD_RATE_NG for a Nigerian workspace, VAT_STANDARD_RATE_KE for a Kenyan one. It tells you to choose a tax code without VAT, or wait.

The refusal tells you two useful things. First, the invoice has not gone out with a wrong or invented VAT figure. Second, the problem is the rule, not your invoice: re-entering the same line will not change the answer.

Choosing a tax code without VAT, or waiting

"Choose a tax code without VAT" does not mean "pick any code that gets the invoice through". If the sale is standard-rated under the law, calling it zero-rated or exempt to get the invoice issued would understate the VAT you owe, and your return would be wrong.

So the honest choices are:

• The supply really is not standard-rated. Pick the code that is correct for it, and the invoice can be issued.
• The supply is standard-rated. Keep the invoice as a draft. Drafts can be changed until they are issued, so nothing is lost by waiting, and the draft is ready the moment the rule is approved.
• The invoice cannot wait. Talk to your accountant about how to bill this customer in the meantime, and record what you agreed, so the VAT can be accounted for properly.

One more trap: the New invoice form under Billing & Finance offers only 15% or 0% VAT and shows rand, so it does not follow Nigerian or Kenyan VAT. Use the invoice form under Accounting, which follows your country's tax codes.

Credit notes follow the original invoice

Keep one more rule in mind. A credit note always uses its original invoice's date and tax codes. So an invoice issued with a code without VAT is credited without VAT, even if the standard rule has been approved since. That is one more reason not to choose a code just to get an invoice out: the choice follows the invoice into every correction.

Exempt, out-of-scope and reverse-charge codes

A Nigerian or Kenyan business picks a tax code on each invoice line: standard, zero-rated, exempt, out of scope or reverse charge. Only standard lines carry VAT. The others exist for genuinely different supplies:

• Zero-rated supplies are taxable at 0%. Nigeria zero-rates items such as basic food, medical and pharmaceutical products, educational books and materials, medical services, tuition from nursery to tertiary level, and exported goods other than oil and gas. Kenya zero-rates exports of goods, supplies to export processing zones and ship stores, among others.
• Exempt supplies carry no VAT at all. Kenya exempts, for example, financial services, unprocessed agricultural produce and the letting of residential premises.
• Out of scope covers amounts that are not supplies for VAT purposes in your business.
• Reverse charge covers supplies where the customer, not you, accounts for the VAT.

Which code fits each of your products is a question for your tax adviser, once, not for each salesperson on each invoice.

Schools in Nigeria meet the zero-rating question every term; see VAT on Nigerian tuition. For Nigeria's small-business exemption, read does a small Nigerian business have to charge VAT?.

Make a short list of every product or service you sell, with the tax code your adviser agrees for each. With that list in hand, a refusal becomes a simple decision instead of a guess.

General guidance only, not advice on your own circumstances. Tax and payroll rules change: check the current position with the authority or your adviser.