VFD vs EFD in Tanzania: TRA invoices without the machine

An EFD (Electronic Fiscal Device) is a physical machine for issuing fiscal receipts recognised by the Tanzania Revenue Authority (TRA). A VFD (Virtual Fiscal Device) does the same job in software: it connects directly to the TRA portal to fetch the details needed to issue a valid invoice, without a physical EFD or an intermediary.

Tally Solutions describes VFD as part of TRA’s modernisation of its Electronic Fiscal Device Management System (EFDMS), existing side by side with EFD systems. Businesses can use a VFD with POS systems or management software for billing, so invoices go to the TRA from the system where the sale is already recorded.

When you issue an invoice, the VFD sends it electronically to the TRA and receives the TRA’s acknowledgement that the invoice has been validated. That round trip is what makes it a valid fiscal invoice.

Because it’s software, a VFD doesn’t need a dedicated machine at the till. It can be used from any smart device with internet access: a laptop, a desktop or a mobile phone. With no hardware, the authorised provider looks after updates and maintenance of the VFD.

Power VFD is a VFD solution developed by Powercomputers, which is an authorised supplier for EFD and VFD solutions. It works with TallyPrime and Tally ERP, as well as Android devices, SAP Business One, Microsoft Dynamics, OMEGA ERP, POWER POS and various customized ERPs.

With TallyPrime, sales invoices are processed in Tally and sent to the TRA through Power VFD, so nobody types the same sale again into a separate device. That avoids double entry and the billing errors that come with it, and keeps your tax and invoice records in one place.

Power VFD can limit the sale amount each user can issue, and limit the days each user can issue invoices. Reports are available user-wise, branch-wise and department-wise, and because multiple users work on one platform, reconciling Z reports, the end-of-day sales and tax summaries, is easier.

Power VFD can also send sales to other applications through an API, and transactions are encrypted and authenticated with verification tokens.

Everything above is about TRA and Mainland Tanzania. In Zanzibar, fiscal receipts are administered by the Zanzibar Revenue Authority (ZRA) through its own system, VFMS. ZRA describes VFMS as a technology-based system that generates receipts and monitors sales transactions and tax collected, with a management portal, a taxpayer portal, a POS application and an enforcement app.

ZRA’s system is separate from TRA’s VFD, so don’t assume a TRA VFD setup covers a Zanzibar business. If you’re in Zanzibar, talk to us before planning fiscal invoicing from Tally and we’ll confirm what applies to you. TallyPrime itself works the same way on the islands and the Mainland.