By The Weekly Vision Business Desk
The Tax Appeals Tribunal has dismissed an appeal by Harley Berry Limited challenging a KSh 317.9 million additional Value Added Tax (VAT) assessment issued by the Kenya Revenue Authority (KRA), finding that the company failed to provide the documentary evidence required to overturn the tax demand.
In a judgment delivered in Nairobi on 14 August 2026, the Tribunal, chaired by Robert M. Mutuma, upheld the Commissioner of Domestic Taxes’ objection decision in full, ruling that Harley Berry Limited had not discharged the burden of proof placed on taxpayers under Kenyan tax law.
The dispute arose on 26 March 2025, when the Commissioner issued the company, a Kenyan private limited liability firm, with an additional VAT assessment amounting to KSh 317,909,009 covering the 2022, 2023 and 2024 tax years. Harley Berry Limited filed a notice of objection on 27 May 2025 and engaged the Kenya Revenue Authority’s Independent Review of Objections (IRO) process in an attempt to challenge the assessment.
According to the Tribunal record, several engagements took place between the company and KRA officials, during which the taxpayer was allowed to provide supporting documentation relating to the disputed input VAT claims.
However, citing time constraints, the Commissioner proceeded to reject the objection and, on 25 July 2025, issued a decision confirming the additional assessment in its entirety. Dissatisfied with the decision, Harley Berry Limited filed a notice of appeal on 28 September 2025, followed by a Memorandum of Appeal on 4 November 2025.
The company argued that it had not been granted sufficient time to retrieve supporting documents relating to input VAT claims. It told the Tribunal that it had encountered difficulties tracing manual records but maintained that transactions captured through the iTax and Electronic Tax Invoice Management System (eTIMS) platforms should have been recognised.
The company submitted a tabulated analysis of what it considered allowable input VAT claims covering various months between January 2022 and November 2023. It further requested the Tribunal to allow deductible input tax equivalent to an average of 40 per cent of its turnover, citing delays in obtaining additional records.
The Commissioner of Domestic Taxes opposed the appeal, arguing that Harley Berry Limited had failed to prove that the disputed input VAT was incurred in the course of generating taxable income. KRA maintained that the taxpayer had been granted adequate opportunity during the objection process to provide supporting documents but failed to do so.
The authority also raised concerns over discrepancies involving some suppliers, including Coolextreme International Limited and Ndume Chainlinks Limited. According to KRA, the input VAT claimed by Harley Berry Limited exceeded the sales figures declared by those suppliers, raising doubts over the validity of the claims.
The Commissioner argued that the assessment had been undertaken using the best judgement available based on information held by the authority, in accordance with provisions of the VAT Act and the Tax Procedures Act.
In determining the appeal, the Tribunal considered whether the Commissioner had erred in confirming the additional tax assessment. The Tribunal reiterated that the burden of proof in tax disputes rests with the taxpayer. It cited Section 56(1) of the Tax Procedures Act, which requires taxpayers challenging tax decisions to prove that such decisions are incorrect, as well as Section 30 of the Tax Appeals Tribunal Act, which places the responsibility on an appellant to demonstrate that an assessment is excessive or ought not to have been made.
The Tribunal also relied on the High Court decision in Commissioner of Domestic Taxes v Block International Limited [2024] KEHC 8889 (KLR), which affirmed the principle that taxpayers must provide sufficient evidence when disputing assessments issued by KRA. Upon reviewing the evidence presented, the Tribunal found that Harley Berry Limited had only filed its notice of objection, the objection decision issued by KRA, and related submissions, without providing the supporting documents required to substantiate its VAT claims.
It noted that the company had not produced documents contemplated under Section 17(3) of the VAT Act, including evidence necessary to demonstrate entitlement to claim input tax.
The Tribunal further held that the company had failed to comply with Section 13(2)(d) of the Tax Appeals Tribunal Act, which requires appellants to provide documents necessary for the Tribunal to make an informed determination.
“The highlighted documents cannot demonstrate that input tax was claimable neither do they demonstrate that the Respondent erred in confirming the assessment,” the Tribunal stated. Consequently, the Tribunal dismissed the appeal, upheld the Commissioner’s objection decision dated 25 July 2025, and directed each party to bear its own costs.
The ruling reinforces a recurring principle in Kenyan tax disputes: businesses seeking to challenge KRA assessments must support their claims with verifiable evidence, including invoices, supplier records, payment records and other relevant documentation.
