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Turnover tax vs VAT comparison workbook

Compare the turnover tax and VAT you would pay on your sales and purchases month by month, and see which is cheaper.

Turnover tax vs VAT comparison workbook template

Small businesses sometimes have a choice between turnover tax and VAT, and the cheaper one depends on how much you buy. Enter your monthly sales and your purchases before VAT, and the workbook works out the turnover tax and the VAT payable for each month and for the year, shows which is lower and checks whether your sales fall in the turnover tax range.

Small business owners deciding how to register, and accountants advising on the better tax for a client's margins.

What is included

  • Turnover tax and VAT worked out side by side
  • Totals for the year and a cheaper-option verdict
  • Check that sales fall within the turnover tax range
  • Rates on a separate sheet you can update
  • Chart of VAT payable by month

Screenshots

  • Turnover tax against VAT of Turnover tax vs VAT comparison workbook
  • VAT payable by month of Turnover tax vs VAT comparison workbook

How to use it

  1. Check the turnover tax and VAT rates and the turnover tax range on the Rates sheet.
  2. Enter your monthly sales and purchases, both before VAT.
  3. Read the turnover tax and the VAT payable for each month.
  4. Check the totals and the cheaper option at the top, and whether you are in range.

Templates are tools to help with your own records. They are not tax or legal advice. Check the figures against official sources before filing or paying.

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What the turnover tax vs vat comparison workbook does

Small businesses sometimes have a choice between turnover tax and VAT, and the cheaper one depends on how much you buy. Enter your monthly sales and your purchases before VAT, and the workbook works out the turnover tax and the VAT payable for each month and for the year, shows which is lower and checks whether your sales fall in the turnover tax range.

Who it is for

Small business owners deciding how to register, and accountants advising on the better tax for a client's margins.

How to use the workbook

  1. Check the turnover tax and VAT rates and the turnover tax range on the Rates sheet.
  2. Enter your monthly sales and purchases, both before VAT.
  3. Read the turnover tax and the VAT payable for each month.
  4. Check the totals and the cheaper option at the top, and whether you are in range.
  5. Save a copy under a new name for each month or year, so earlier records stay as they were.

What is inside

  • Turnover tax and VAT worked out side by side
  • Totals for the year and a cheaper-option verdict
  • Check that sales fall within the turnover tax range
  • Rates on a separate sheet you can update
  • Chart of VAT payable by month

The workbook has these sheets: Instructions, Months, By month, Rates. The main table has the columns Month; Sales (before VAT); Purchases (before VAT); Turnover tax; VAT payable; Cheaper. Yellow cells are for you to fill in and grey cells calculate by themselves, so leave the grey cells alone. The example rows show how it works; type over them with your own entries.

Tips for getting it right

  • Eligibility rules matter as much as the cheaper figure; check them with KRA.
  • Include all vatable purchases that you can support with invoices.
  • VAT lets you claim input tax, so businesses with high costs often do better under it.
  • Review the comparison whenever your costs or sales change.

Why keep this record

Most tax trouble comes from late or missing records rather than from the tax itself. When the figures are collected as they happen, preparing a return becomes a matter of copying totals, not of searching for receipts. A workbook that follows the same layout as the return also makes it easier to spot a number that looks wrong before KRA does, and to explain it if asked.

Questions people ask

Do I need to know Excel formulas? No. Type into the yellow cells and the rest is worked out for you. The formulas are visible if you want to see how a figure is reached.

Can I add rows or change the layout? You can add your own columns to the right and your own notes. If you insert rows inside a table, copy the grey formula cells down so the new rows calculate too.

Will it work on my phone or in Google Sheets? Yes for viewing and typing, but dropdown lists and the charts look best in desktop Excel or LibreOffice.

Keeping it safe and up to date

Tax figures change with each Finance Act, so check the Rates sheet against KRA's current guidance before you file. Keep the supporting documents with the workbook, and keep each year's copy for at least five years in case KRA asks for proof.

Read the KRA filing calendar for small businesses for the wider picture. Free calculators that go with it: Turnover tax calculator, Vat calculator, Vat registration checker. See more tax templates or ask us for a custom one.

The workbook works in Microsoft Excel, LibreOffice and Google Sheets. It is a tool to help you work out and record figures, not tax, legal or accounting advice, and it is not affiliated with the Kenya Revenue Authority. If something does not work as described, contact us and we will put it right.

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