Does Twilio Sendgrid Inc. charge Value Added Tax (VAT) in Kenya?

As of October 9, 2020, Kenya requires non-resident entities like Twilio SendGrid Inc. (“Twilio SendGrid”) to collect Value Added Tax (VAT) for any Electronically Supplied Services (“ESS”) sold to all customers located in Kenya. This guide covers how Twilio SendGrid charges VAT and what services are taxable.

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Value Added Tax (VAT) overview

Kenya Revenue Authority (KRA) passed legislation effective October 9, 2020, requiring non-resident entities selling digital services to collect and remit a 16% Value Added Tax  (VAT) on its sales to Kenyan private consumers (B2C) .

With effect from 1 July 2022, the above rules were extended to include B2B supplies.

 Non-residents are required to apply VAT on both  Business to Customer (B2C) transactions and Business to Business (B2B) transactions.

When will Twilio Sendgrid start charging VAT in Kenya?

Twilio SendGrid will begin collecting VAT on services sold to customers located in Kenya starting in February 2024.

VAT is assessed and applied to your account at the start of the month for the previous month’s usage. For example, you will be charged VAT for your February usage in March.

How can I be tax exempt for VAT?

Twilio SendGrid Inc is required to impose VAT on both B2B and B2C customers.  In other words, there are no exemptions provided under the tax provisions for the type of services that Twilio SendGrid Inc provides in Kenya. This includes but isn't limited to public school, university, charitable organizations, religious body, etc.

How is VAT determined?

VAT is applicable based on the type of products or services that are purchased. We have determined that most of Twilio Sendgrid's products & services are subject to VAT in Kenya.

What rate is VAT charged in Kenya?

Twilio SendGrid's services will be subject to the 16% VAT rate as determined by the Kenya Revenue Authority (KRA)

Where can I see the VAT charged on my Invoice?

You can see the VAT amount charged in the Tax Summary section of your invoice. Your invoice will continue to show subscription charges, usage and taxes in the same currency as before.

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