When eTIMS applies to farming
Selling produce to a neighbour at the gate is one thing, but selling to a processor, an exporter, a supermarket or any business buyer is a clear commercial sale. Those buyers want a compliant invoice so they can claim the cost of the produce they buy from you. As agribusiness formalises, more farm sales fall into this category.
Many unprocessed agricultural products are zero-rated for VAT, which means the invoice carries no VAT but is still a compliant invoice. Knowing which of your products are zero-rated, exempt or standard-rated keeps your invoicing correct and avoids charging VAT where you should not.
The zero-rated treatment carries a useful advantage that many farmers miss. Because produce sales are zero-rated rather than exempt, a VAT-registered agribusiness can still reclaim the input VAT on standard-rated farm inputs like packaging, fuel and some equipment, even though it charges no VAT on the produce itself. Treating the sale as exempt by mistake throws that legitimate refund away.
How farmers handle eTIMS
Work out where commercial sales and VAT treatment land, then keep every sale and input cost on record.
- 1
Identify your business buyers
Processors, exporters, supermarkets and other business buyers need compliant invoices. Focus your compliance there.
- 2
Know your VAT treatment
Determine which produce is zero-rated, exempt or standard-rated so each invoice is correct.
- 3
Onboard with the right PIN
Use the correct KRA PIN for the farm or agribusiness entity, with current iTax contacts.
- 4
Issue compliant invoices on sales
For each commercial sale, issue a compliant invoice with the buyer’s PIN where they are a business.
- 5
Track produce, cost and margin
Record what you sell and at what cost so you know whether each crop or product is actually profitable.
Farmer eTIMS mistakes
Charging VAT on zero-rated produce
Many unprocessed products are zero-rated. Charging VAT on them is wrong and creates reconciliation problems.
No invoices for processor sales
Business buyers need compliant invoices. Selling without one limits who will buy from you.
No record of cost and margin
Without tracking input costs against sales, you cannot tell which crops make money.
Forfeiting input VAT on farm inputs
Because produce is usually zero-rated, not exempt, a VAT-registered farm can reclaim input VAT on packaging, fuel and other standard-rated inputs. Treating produce as exempt, or not registering when it pays, quietly hands that refund back.
A farmer selling to a processor
A farmer sells produce to a processing company for KES 300,000. The produce is zero-rated, so the compliant invoice shows the KES 300,000 with no VAT charged, while still carrying a control number and the processor’s PIN so the buyer can record the purchase properly.
The farmer tracks the cost of growing that produce against the sale, and the profit margin calculator shows whether the crop genuinely paid after inputs. Because the invoice is compliant and the VAT treatment correct, the processor’s records are clean and the relationship is easy to continue season after season.
Because the produce is zero-rated rather than exempt, the farm can also reclaim the input VAT on the standard-rated packaging and fuel it bought to get that crop to the processor. Over a season those refunds are real money, and they only stand up because the farm kept compliant invoices for both its sales and its inputs.
Trading without eTIMS-compliant tax invoices risks KRA penalties, blocked VAT input claims for your customers, and receipts a business buyer cannot expense.
Veira signs every sale to KRA eTIMS automatically, so each receipt is compliant the moment it prints, with no separate device to reconcile.
Veira for farmers and agribusiness
Veira issues compliant invoices for produce sales with the correct VAT treatment, including zero-rated items, and captures buyer PINs for processors, exporters and supermarkets. Your commercial sales are documented cleanly.
It also tracks what you sell and at what cost, so you can see which crops and products are profitable rather than guessing. That turns compliance into a tool for running a better farm business.
Veira keeps the compliant invoices for your inputs, the packaging, fuel and supplies you buy, alongside your produce sales, so a VAT-registered farm can claim the input VAT it is owed on zero-rated output. The refund you are entitled to stops slipping away.
Frequently asked questions
Do farmers need eTIMS in Kenya?
Is produce VAT zero-rated?
Do I charge VAT when I sell produce?
What does a processor need on my invoice?
How do I know if my crop is profitable?
Which PIN should an agribusiness use?
Can a farmer reclaim VAT on inputs if produce is zero-rated?
Do I need to register for VAT as a farmer?
For farmers and agribusiness, eTIMS applies wherever you sell to business buyers, and getting the zero-rated treatment right keeps those invoices clean. Identify your commercial buyers, know your VAT treatment, invoice compliantly, and track cost and margin. Check crop profitability with the margin calculator, run the readiness checker, or book a free demo.