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TAX MADE EASY

ABC Accounting & Business Consultants

5 Feb 2022

LATEST UPDATES FROM ZRA ON RENTAL INCOME TAX


  • Responsibility to pay tax has shifted from Tenant to Landlord. No Tax to be withheld by the Tenant.

  • Rental Income has been Isolated as a separate source of income and not to be bundled with other income sources.

  • Rental Income is not bundled such as PAYE. If Annual Rental Income is above K800,000 then the whole amount is liable for Rental Income Tax at 12.5%.

  • Same treatment applied to both Individuals and Companies.

  • VAT at 16% will continue to be applied on Commercial Properties. Rental Income Tax shall apply on the amount excluding VAT.

Rental Income Tax under Income Tax

If the landlord is already registered for income tax, your tax on rental income should be paid through income tax. This should be done by submitting an Annual provisional income tax return declaring the annual rental income amount. This amount should be exclusive of VAT, if applicable. The tax on rental income can be paid monthly or quarterly. At the year end, a final income tax return should be submitted declaring the actual rental income for the year and any balance of taxes to be paid at this point.

Rental Income Tax under Turnover Tax

If the landlord is not registered for income tax currently, then they should apply to be registered under turnover tax. Under turnover tax, rental income tax returns to be submitted on the 14th of the following month as well as the payments to be made on the 14th of the following month.


You can download this Publication as a PDF file below.


TAX MADE EASY - Rental Income (Made Easy)
.pdf
Download PDF • 675KB


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