Aaro East Africa Limited v Commissioner of Legal Services And Board Coordination (Tax Appeal E365 of 2023) [2024] KETAT 735 (KLR) (17 May 2024) (Judgment)
- Court
- Tax Appeals Tribunal
- Case number
- 735
- Citation
- [2024] KETAT 735 (KLR)
- Decided
- 17 May 2024
The Tribunal determined that the services provided by Aaro East Africa Limited were not exported services and thus not zero-rated.
Facts
Aaro East Africa Limited, a subsidiary of AARO Sweden, provided software implementation and maintenance services to various clients. The Commissioner of Legal Services and Board Coordination issued assessment orders seeking to recover Kshs. 8,286,381.28. Aaro East Africa Limited objected to the additional assessment and filed a Notice of Appeal.
Issues
- Whether Appellant’s services were exported services that are zero rated
Reasoning
The Tribunal applied the VAT Act and Value Added Tax Regulations to determine that the recipient of the services must be outside Kenya. The identity of the customer should be legally connected to the service provider, such as through a business agreement.
Outcome
The Tribunal dismissed the appeal.
Authorities cited
Legislation (2)
- VAT Act
- Value Added Tax Regulations
Cases cited (2)
- Unilever Kenya Ltd v Commissioner of Income Tax
- FH Services Limited v Commissioner of Domestic Taxes
Loading judgment…