Tax, VAT, customs and trade alerts

We provide a wealth of publications by PwC Kenya providing informed commentary on current developments in the tax arena.

Through analysis and comment on new law and judicial decisions of interest, they assist business executives to identify developments and trends in tax law and revenue practice that might impact their business.

Subscribe to our Tax Alert mailing list here

In this alert:

High Court rules on who is the principal supplier for VAT purposes for services offered by digital platforms

We are pleased to share our latest tax alert on a significant High Court ruling on  the Value Added Tax (“VAT”) treatment of transactions conducted through digital platforms. The case in focus is Commissioner of Domestic Taxes v Sendy Limited (Income Tax Appeal No. E137 of 2024), which examined a critical question: Who is the principal supplier of logistics/transportation services offered via the Sendy platform and therefore liable for VAT on the full invoice amount?

Despite a prior private ruling by the Kenya Revenue Authority (“KRA”) indicating that Sendy should only account for commissions earned, the High Court reached a different conclusion. The Court held that Sendy is the principal supplier of logistics/transportation services because it controls the entire transaction from point of contact with a customer, allocation of a driver, authorizing delivery to issuing of Request For Payment (“RFPs”) which the customer pays directly to Sendy’s account. 

Our alert unpacks the facts, arguments and the outcome of the case. 

For those of you who have similar operations or simply operate digital platforms, please get in touch and we can discuss how this case may affect you.