Learn About eTIMS
Buyer Initiated Invoicing
TAXPAYER GUIDELINES ON THE eTIMS BUYER INITIATED INVOICING
1. Introduction
The Kenya Revenue Authority (KRA) has implemented Buyer Initiated Invoicing (BII) as part of the electronic Tax Invoice Management System (eTIMS). The BII model shall enhance tax compliance, improve invoicing accuracy and strengthen the integrity of transactions in targeted economic sectors.
eTIMS, a flexible and user-friendly software solution, enables taxpayers to issue, receive and manage electronic tax invoices from various devices including computers, laptops, tablets, smartphones, and PDAs through different solutions. The solution options include:
- The eTIMS Online Solution,
- The eClient solution (Windows, Android & Multi-paypoint options),
- System-to-System Integration via OSCU (Online Sales Control Unit) or VSCU (Virtual Sales Control Unit),
- The ePOS on eCitizen (USSD & Web options),
- The eTIMS Non-VAT Lite mobile application (iOS).
Under the BII model, a registered buyer generates a tax invoice on behalf of a seller for goods or services supplied where the seller is not in a position to issue the invoice directly. Sellers include small scale farmers supplying produce to large processors or exporters and informal traders without invoicing systems. This model ensures transparency, real-time reporting, and accurate record keeping.
This guide provides insight on the process, requirements, controls, and compliance expectations for participating in Buyer Initiated Invoicing under eTIMS so as to ensure seamless adoption of the BII model while minimizing fraud and errors. It serves as a reference to ensure smooth adoption, consistent implementation and adherence to Kenya’s tax laws and policies through streamlining validation, approval, and dispute resolution processes and enhancing transparency and real-time tracking for tax compliance.
2. System overview
BII allows a registered buyer to generate a tax invoice on behalf of a seller for goods or services supplied. This model is appropriate where sellers are not well- positioned to issue tax invoices, such as in agricultural or informal sectors. BII ensures transactional transparency and real-time reporting to KRA.
3. Workflow and process logic
Access to the BII solution is provided through eCitizen. Buyers log into the KRA Profile by selecting the Buyer Initiated Module on eCitizen or by dialing *222# and navigating to the Buyer Initiated Module under KRA Services.
The Buyer initiates the request, followed by validation of the Seller’s details against KRA records. Where required, the Seller is automatically onboarded onto eTIMS, ensuring compliance with statutory requirements.
The Buyer initiates the invoice via eTIMS by logging into their eTIMS solution and selecting the "Initiate Buyer Invoice" option. The buyer enters key invoice details such as the Seller’s ID or PIN, the Invoice Number and date, the description of goods or services and the unit price, quantity and total amount. Alternatively, the buyer may upload these details via a .csv file as outlined in the eTIMS Buyer Initiated Invoicing User Manual [2025].
The eTIMS system validates the seller’s KRA PIN validity and eTIMS on-boarding status, and blocks the issuance of invoices for VAT-registered sellers. Invoice data is validated against pre-filled charts. The BII request is then generated by the system and a message is sent to the seller via SMS through their eTIMS-registered details containing the name of the buyer and which informs them that they have a pending invoice for approval. A report is also generated for the seller to view the status of the buyer-initiated invoice, that is, whether it is approved, rejected or pending. Pending invoices include those that have not been submitted successfully due to a system communication error or that are awaiting approval form the seller’s side
The seller is notified of the pending invoice and must consent to the request by the buyer by accepting or rejecting the generated invoice. They are notified through a prompt sent via Unstructured Supplementary Service Data (USSD). Sellers have thirty (30) days during which they may accept or reject the generated invoice after which the invoice is automatically rejected as stated in the Buyer Initiated Invoicing USSD Consent Step by Step Guide [2025]. Approved invoices are transmitted to eTIMS in real time. The system logs all actions, that is, the initiation, approval and modifications of invoices. Any misuse or fraudulent activity related to buyer-initiated invoices will result in immediate deactivation of eTIMS by the Tax Service Office (TSO) if the buyer is found to be non-compliant or to have contravened their terms of approval.
The process flow captured in the chart below outlines the complete sequence of interactions between the Buyer, the Seller and the eTIMS solution. The Buyer is required to initiate invoice generation with accurate details such as seller ID, quantity and price and to comply with applicable data protection laws. Sellers are required to on-board onto eTIMS, approve or reject invoices within 30 days and generate credit notes to correct original invoice in the case of correcting errors, including taxpayers using USSD option.
Buyer Initiated Invoicing Process Flow
4. Compliance & legal safeguards
Buyer Initiated Invoicing (BII) under eTIMS is supported by Kenyan tax law, which sets out requirements for electronic invoicing and conditions under which a buyer may generate a tax invoice on behalf of a seller.
Section 16(1)(c) of the Income Tax Act (Cap 470) mandates the use of electronic invoicing through eTIMS for the allowance of deductions on loss or expenditure and the Tax Procedures Act Cap 469B Section 23A (3A) allows a purchaser to issue an electronic invoice on behalf of a small-scale seller.
Buyers must consent to KRA’s data usage policies with penalties applying for the deliberate misuse of data as per Section 23A of the Tax Procedures Act. Both the Buyer and Seller are required to agree to a declaration confirming their understanding and compliance with invoicing policies, legal requirements, and ethical standards. The buyer and the seller have to agree to the Terms and Conditions.
5. Record keeping & reporting
eTIMS securely stores all Buyer Initiated Invoices and related transaction details, ensuring a complete and accurate record for compliance and audit purposes. Interactive dashboards allow users to monitor the status of invoices at any time, including pending, approved and rejected transactions.
Appendix 1: Links
Appendix 2: BII process flow diagram
A detailed flowchart illustrating each step in the Buyer Invoice Initiation (BII) process—from buyer login and invoice entry, through system validations, seller notifications, to final approval or rejection. This diagram provides a visual reference for stakeholders and technical teams.
Detailed Buyer Invoice Initiation Flow
Yes: Submit for Seller Approval / Rejection
Yes: Notification to Seller to Buyer for Approval
Appendix 3: Sample validation rules
The PIN Checker verifies that the Buyer and Seller PINs conform to the valid format as per the tax authority’s standards. PIN must follow the structure defined by the KRA format, for example, `A123456789Z` and `P123456789Z`. The PIN starts with a letter `A` for individuals/sole proprietors and `P` for companies, followed by 9 digits and ends with a letter and must be exactly 11 characters. The system cross-checks the PIN against the tax authority database (KRA) to link to iTAX Database if API access is available
Example
- Valid PIN: `P123456789Z`
- Invalid PIN: `X12345678`, `P12345678912`, `A1234567890` Error Handling/ Error Messages:
Return: "PIN must be 11 characters, start with 'A' or 'P', followed by 9 digits, and end with a letter."
