Published: July 2026 | Practice areas: Lesotho Tax & Regulatory | Corporate & Commercial | Cross-Border
The announcement
On 16 July 2026, Revenue Services Lesotho (“RSL”) issued a public notice to all VAT-registered taxpayers extending the mandatory national rollout deadline for the Lekuka e-Invoicing System from 31 July 2026 to 30 October 2026.
The notice, signed by the Acting Commissioner Client Services, records that the extension follows a review of implementation status and engagement with taxpayers, software vendors and business associations, and discloses a striking figure: more than 90% of VAT-registered taxpayers have not yet completed integration with Lekuka. The stated purposes of the extension include allowing time for system integration and testing, permitting accredited software vendors to work through the on-boarding backlog, and, significantl, reducing “the risk of non-compliance arising from factors beyond taxpayers’ reasonable control”.
For most vendors the practical message is welcome and simple: you have roughly three more months. The legal position is less simple, and it is worth setting out carefully, because the extension does not do everything a reader might assume it does.
What has not changed: the Regulations remain in force
The mandate rests on the Value Added Tax (E-Invoicing) Regulations, 2026, promulgated under Legal Notice No. 25 of 2026 and made under section 88 of the Value Added Tax Act, 2001 (Act No. 9 of 2001). Those Regulations were gazetted on 27 March 2026 and commenced on 1 April 2026. They establish the Invoice Data Management System (“IDMS”), the accreditation regime for Electronic Billing Systems (“EBS”), digital certificate and invoice requirements, the respective duties of the Commissioner-General, EBS manufacturers and suppliers, vendors and customers, and a schedule of offences, administrative penalties and sanctions.
Nothing in the 16 July notice purports to amend, suspend or repeal any provision of Legal Notice No. 25 of 2026. Two features of the notice reinforce that reading:
- It is an administrative communication, not a subordinate legislative instrument. An obligation created by regulation is displaced only by an amending instrument gazetted through the same process. Until an amending Legal Notice appears in the Government Gazette, the Regulations continue to operate according to their own terms.
- It is signed by a divisional Acting Commissioner. The guideline-making and accreditation powers under the Regulations are conferred on the Commissioner-General. A notice issued by the Acting Commissioner Client Services is best characterised as a statement of administrative and enforcement policy rather than an exercise of a delegated legislative power.
The correct characterisation is therefore that RSL has announced forbearance in enforcement during a defined window, not that the legal obligation has been postponed.
This distinction matters. Where the compliance date was itself fixed administratively (through RSL communications and the Commissioner-General’s discretion as to when particular vendors must adopt an approved EBS), RSL can lawfully move it administratively, and the notice is effective on its own terms. Where a date is fixed by the Regulations or by a gazetted notice, it can only be moved by amendment. Vendors should not assume which of these applies to their circumstances without checking the gazetted text and any subsequent Legal Notice.
The consequences that survive the extension
Several exposures are unaffected by a mere extension of the enforcement date, and clients are frequently surprised by them.
Invoice validity and input tax. Under the clearance model, an invoice derives its status from successful validation through the IDMS, carrying a digital signature and QR code generated by an accredited EBS. Paper and PDF invoices are not the legally contemplated instrument for in-scope transactions. The risk is therefore two-sided: a non-compliant invoice is a problem for the issuing vendor as a matter of enforcement, and a potential problem for the recipient if input tax is later challenged on the footing that the document relied upon was not a valid tax invoice. A purchaser’s protection does not come from RSL’s forbearance towards its supplier.
Buyer-side duties. The Regulations draw customers into the compliance architecture, with expectations that invoices be verified through the Verification Portal and discrepancies reported. Businesses that have focused their readiness project purely on their own sales cycle have addressed only half of their exposure.
Penalties remain on the statute book. The regime carries administrative penalties in the range of M50,000 to M300,000, and criminal sanctions of fines up to M500,000 and/or imprisonment of up to six months. An extension of the rollout deadline does not repeal Regulation 16; it signals how the Commissioner-General presently intends to exercise discretion.
Technical guidance is still outstanding. The Commissioner-General’s Guidelines contemplated by the Regulations, covering registration, accreditation, IDMS operation and invoice verification, and expected to carry the detailed schema, error-handling and offline procedures, remain a moving target. Vendors integrating now should build with change control in mind, and should not treat a current successful integration as a permanent one.
The 90% admission and its defensive value
The most useful sentence in the notice, from a practitioner’s perspective, is not the new date. It is RSL’s own recorded finding that more than 90% of VAT-registered taxpayers have not completed integration, coupled with the express object of reducing non-compliance “arising from factors beyond taxpayers’ reasonable control”.
That language is an official acknowledgment, on the record, that (a) systemic readiness, including accredited vendor capacity, has lagged the legal framework, and (b) non-integration as at mid-2026 was substantially attributable to causes outside individual taxpayers’ control. Where RSL later seeks to impose administrative penalties in respect of the period between 1 April 2026 and 30 October 2026, this notice is evidence a taxpayer can deploy directly in objection or in representations on remission.
There is a related, but narrower, argument based on legitimate expectation. The notice is a clear, unambiguous and unqualified public representation by RSL, made to the class of all VAT-registered taxpayers, on which vendors will predictably order their affairs. A taxpayer who structures its implementation programme in reliance on the 30 October date has a strong basis to resist penalisation for the interim period, and to insist on procedural fairness before that position is departed from.
The argument has limits, and clients should be advised of them plainly. A revenue authority’s representation cannot ordinarily override an obligation imposed by statute or regulation, and no estoppel operates to defeat the operation of the tax law itself. Legitimate expectation is likely to bite on penalty and enforcement discretion, not on the underlying validity of an invoice or a purchaser’s entitlement to input tax. Reliance on the notice is a defence to sanction, not a cure for a defective document.
What vendors should do with the window
The extension is time to complete a project, not a reason to pause one. Practical priorities:
- Confirm accreditation, in writing. Contract only with EBS suppliers on RSL’s accredited register, and verify the register rather than the marketing material. Provider accreditation can be withdrawn.
- Fix the contract before the integration. EBS supply agreements should carry express warranties as to accreditation and continued technical compliance, defined uptime and support obligations, obligations to implement changes required by future Commissioner-General Guidelines at no additional charge, indemnities for penalties attributable to provider failure, data-handling and confidentiality terms appropriate to transaction-level fiscal data, and a workable exit and data-migration right.
- Register and obtain digital certificates now. Certificate issuance and user registration through the Self-Service Portal sit upstream of integration testing; the queue will lengthen as October approaches.
- Reconcile procurement. Update supplier onboarding and accounts-payable controls to require and verify cleared invoices, and preserve the verification record. This is the practical protection of input tax.
- Deal with group and cross-border structures. Where a Lesotho entity is served by a shared ERP or a South African group finance function, the Lesotho connector is a discrete build. Multinationals should assume a Lesotho-specific integration and budget accordingly.
- Document the delay. Vendors who cannot complete integration should keep a contemporaneous record of provider lead times, quotations, correspondence and technical obstacles. That file is the evidential foundation of any later penalty remission request.
Implications for South African businesses trading into Lesotho
South African suppliers with a Lesotho VAT registration are squarely within the mandate; those without one are not required to issue through Lekuka, and inbound foreign invoices are not cleared through the IDMS. But South African groups should note two points. First, a Lesotho subsidiary’s compliance failure is a group risk, and the sanctions include criminal exposure. Second, South Africa’s own move to mandatory e-invoicing is coming, the direction of travel signalled by SARS and National Treasury points to a phased rollout later this decade. Lesotho’s implementation is, in effect, an early and instructive case study in a group’s regional compliance planning.
Watch the Gazette
The position to monitor over the coming weeks is whether an amending Legal Notice is published to align the Regulations with the announced 30 October 2026 date, and whether the Commissioner-General’s Guidelines are issued in the same period. Either development changes the analysis above, and businesses should keep their implementation timetable under review rather than treating the July notice as the last word.
Frequently asked questions
Does the extension mean I can keep issuing paper or PDF invoices until 30 October 2026? Not safely. RSL has announced that it will not enforce the mandatory rollout before that date. It has not announced that non-cleared invoices are valid tax invoices in the interim. The safer course is to complete integration and issue through an accredited EBS as soon as you are able.
Can RSL still impose penalties for the period before 30 October 2026? The penalty provisions remain in force. However, RSL’s own notice records systemic non-readiness and expressly refers to factors beyond taxpayers’ reasonable control, which is material evidence in any objection or request for remission.
My business turns over less than M2 million. Am I affected? The mandate attaches to VAT registration. Following the increase of the VAT registration threshold to M2,000,000, many small enterprises fall outside the VAT net and therefore outside Lekuka — but voluntary registrants, and auctioneers (who register irrespective of turnover), remain in scope.
My EBS provider says it will only be ready in October. What should I do? Record the position in writing with the provider, secure a firm implementation date and contractual protection for penalties caused by provider delay, and consider whether an alternative accredited provider can deliver sooner.
This article is provided for general information as at July 2026 and does not constitute legal advice. The regulatory position is developing and readers should obtain advice on their specific circumstances.