Phone: +254 729 842 847

Email: info@blueoceanoutsource.co.ke

When Should You Deregister for VAT?

When Should You Deregister for VAT?

You may consider deregistering for VAT if:

1. Your Turnover Falls Below KES 5 Million Annually

If your annual taxable turnover drops below the VAT registration threshold, you are eligible to apply for deregistration.

2. Business Closure

If you cease trading or close your business altogether, you should notify KRA and apply for VAT deregistration.

3. Change in Business Model

If your operations shift to dealing mostly with exempt goods or services (which do not attract VAT), you may no longer need to be VAT-registered.

Conditions to Meet Before VAT  Deregistration

Before KRA approves your deregistration:

  • All VAT returns must be filed up to date.

  • Outstanding taxes, penalties, and interest must be cleared.

  • You must not have any ongoing audits or disputes with KRA.

How to Deregister for VAT in Kenya

Step 1: Log into the KRA iTax Portal

Visit https://itax.kra.go.ke and log in with your PIN and password.

Step 2: Apply for Deregistration

Navigate to “Registration” > “Other Registration” and select “Deregistration.”

Step 3: Choose VAT as the tax obligation to deregister

Indicate the reason and date for deregistration.

Step 4: Submit Supporting Documents

You may be required to upload evidence such as audited accounts, closure notices, or board resolutions.

Step 5: Wait for Approval

KRA will review your application. If everything is in order, they will process your deregistration and send a confirmation.

After Deregistration

  • You must stop charging VAT immediately.

  • You are still required to keep records for at least 5 years.

  • Any final VAT obligations must be settled.

Note

Deregistering from VAT is not complicated but it must be done properly to avoid penalties. Whether due to low turnover or business closure, it’s important to follow KRA guidelines closely.

Need Help with VAT Deregistration?

We assist businesses in filing accurate returns, clearing obligations, and completing a smooth VAT deregistration process.

📍 Biashara Plaza, Moi Avenue, Nairobi
📧 info@blueoceanoutsource.co.ke
📞 +254 729 842 847

Get in touch for professional tax support today.