eTIMS bookkeeping in Kenya

Every expense needs a compliant invoice

A supplier invoice without a KRA control number and QR code does not back a deductible expense. The bookkeeper's first quality check on a new supplier invoice is whether it carries those fields. If it does not, the expense is non-deductible against income tax, regardless of whether the payment was made.

For routine VAT-registered suppliers this is usually straightforward; they issue eTIMS invoices automatically. For smaller suppliers (below KES 5 million annual turnover) who are not on eTIMS, the bookkeeper needs to set up the buyer-initiated invoicing workflow so the eTIMS invoice issues against the buyer's PIN on the supplier's behalf. Without this, the expense is informally documented and unfortunately non-deductible.

Reconciling received purchase invoices

The KRA portal shows the bookkeeper every eTIMS invoice that has been issued to the business's PIN. This is the universe of deductible expenses. The books should reconcile to this universe, not to the universe of supplier paperwork sitting in the office.

Common gaps: an invoice that the supplier transmitted but never sent to the bookkeeper (so the books miss it); an invoice the supplier sent in PDF but never transmitted (so eTIMS does not have it). The first is easily fixed; the second needs the supplier to actually transmit through eTIMS for the expense to be claimable.

Integrating eTIMS data into the accounting system

A modern bookkeeping workflow pulls eTIMS data into the accounting system as the source of truth for both sides: sales are taken from transmitted invoices, purchases are taken from received invoices in the PIN. The bookkeeper's job becomes confirming the data, classifying it, and handling exceptions, rather than entering every transaction by hand.

Where the accounting system is integrated to a POS that runs OSCU eTIMS (like Veira), this happens automatically. Where the bookkeeper is working off a desktop accounting package and a separate eTIMS Client, the reconciliation is more manual but the principle is the same: eTIMS is the source for what counts as income and expense for tax purposes.

Record retention

The Tax Procedures Act requires businesses to keep records for the prescribed retention period (currently five years, with some categories longer). For eTIMS specifically, this includes the transmitted invoice data, the received invoice data, and the supporting documentation (contracts, LPOs, correspondence on corrections).

eTIMS itself stores the data on KRA's side, so even if a business loses its local copy, the transmitted records can be retrieved through the portal. But local copies, properly indexed, are what gets you through an audit quickly. Lost data plus a portal pull is a slower path.

Why bookkeeping has gotten harder and easier at the same time

Harder: every expense now needs a compliant invoice, and the bookkeeper is the line of defence against non-deductible costs slipping into the books. A bookkeeper who accepts informal receipts as backup for expenses is exposing the client to disallowance.

Easier: the source-of-truth question is now settled. Before eTIMS, sales numbers came from the till tape, the M-Pesa log and the bookkeeper's reconciliation, often disagreeing. After eTIMS, the transmitted invoice is the answer; everything else is supporting documentation. Under Legal Notice No. 64 of 2024 and the January 2026 enforcement of income/expense validation, this is the position KRA defaults to as well.

A monthly close routine for eTIMS-era bookkeeping

1. Pull eTIMS received invoices for the month. Every supplier invoice issued in the client's PIN. This is the deductible-expense universe.
2. Match each invoice to a payment in the books. Identify payments without a matching eTIMS invoice. Chase the supplier or arrange buyer-initiated invoicing.
3. Pull eTIMS transmitted sales for the month. This is the income universe. Compare against the books.
4. Reconcile to the VAT and provisional returns. Catch any per-rate mismatches before they end up on a filed return.
5. File the supporting documentation. Contracts, LPOs, credit notes, correspondence. Indexed by month.

How Veira handles this

For SMBs on Veira, the bookkeeper's monthly close is mostly reading rather than entering: transmitted sales, received purchases, and reconciliations are produced by the system. The bookkeeper's time goes to exception handling and analysis rather than to data entry.