If your business provides ongoing services -- whether it is a monthly retainer, a subscription product, or a regular maintenance contract -- you are likely spending hours each month creating and sending the same invoices. Recurring invoices eliminate this repetitive work by automatically generating and delivering invoices on a set schedule. For Kenyan businesses managing multiple clients, this is a significant time saver.
Who Benefits from Recurring Invoices?
Recurring invoices are ideal for any business that charges the same amount at regular intervals. This billing model is becoming increasingly common in Kenya as more businesses move toward subscription and retainer-based pricing. If you find yourself creating identical invoices month after month, recurring billing should be your next priority.
- IT service providers and managed service companies billing monthly support retainers.
- Marketing and creative agencies with ongoing client retainers.
- Property managers collecting monthly rent from multiple tenants.
- SaaS companies billing subscription fees to Kenyan clients.
- Cleaning, security, and maintenance companies with regular service contracts.
- Consultants and coaches with ongoing advisory engagements.
How Recurring Invoices Work
- 1You create a master invoice template with the client details, line items, amounts, and tax calculations.
- 2You set the billing frequency (weekly, monthly, quarterly, or annually) and the start date.
- 3The system automatically generates a new invoice with a unique number on each billing date.
- 4The invoice is sent to your client via email, with all your payment details included.
- 5You receive a notification when the invoice is delivered and again when payment is received.
Setting Up Recurring Invoices: Key Decisions
| Decision | Options | Recommendation |
|---|---|---|
| Billing Frequency | Weekly, Monthly, Quarterly, Annually | Match your service agreement terms |
| Invoice Date | Start of period, End of period | Start of period for better cash flow |
| Payment Terms | Due on receipt, Net 7, Net 14, Net 30 | Net 14 balances speed with client flexibility |
| Auto-send | Draft first or send automatically | Auto-send for trusted clients, draft for new ones |
| End Date | Fixed end date or indefinite | Match your contract duration |
VAT Considerations for Recurring Invoices in Kenya
Each recurring invoice is treated as a separate tax event by KRA. This means every auto-generated invoice must include the correct VAT calculation, your KRA PIN, and all other mandatory fields. If VAT rates change (as they occasionally do in Kenya's Finance Bills), you need to update your recurring invoice templates immediately to remain compliant.
Important: Even though recurring invoices are automated, each one must comply with KRA tax invoice requirements. Ensure your invoicing software automatically includes updated VAT rates and your KRA PIN on every generated invoice.
Combining Recurring Invoices with M-Pesa Payments
The most efficient billing setup for Kenyan businesses combines automated recurring invoices with M-Pesa payment integration. When your client receives an automatically generated invoice that includes your M-Pesa Paybill or Till number, they can pay within seconds. Some advanced invoicing platforms even support M-Pesa STK push, which sends a payment prompt directly to the client's phone upon invoice delivery.
Common Mistakes to Avoid
- Forgetting to update recurring templates when your prices change, leading to underbilling.
- Not setting an end date for project-based retainers, resulting in invoices being sent after the engagement ends.
- Failing to review auto-generated invoices periodically to ensure accuracy.
- Not communicating the recurring billing arrangement clearly to clients before the first invoice.
