Section 6A of the Income Tax Act CAP 470 which came into effect from 1st January 2016 requires any resident person earning residential rental income exceeding Ksh. 144,000 but not exceeding Ksh10 Million per year to pay the Monthly Rental Income (MRI) tax at a rate of 10% of the gross rent income earned.
Persons liable to account for the monthly rental income tax (MRI) are advised to register in the iTax portal and remit their monthly returns and payments consistently.
Residential property owners earning more than Ksh. 10 Million per year and owners of commercial property are required to declare the rental income in their annual income tax returns and make appropriate payments.
Further, KRA wishes to inform all property owners (Residential and Commercial) to voluntarily make full disclosure of all their properties, amount of rental income earned, file accurate returns and make prompt payments of the tax due.
KRA will apply punitive enforcement measures to any person in default as stipulated in the Tax Procedures Act, 2015 for failure to comply with the provisions of the tax laws.
For further information, or clarification on this matter, please follow the link below; https://www.kra.go.ke/individual/filing-paying/types-of-taxes/residential-rental-income or
Visit your nearest KRA Taxpayer Service Office (TSO) or call our KRA Contact Centre on Tel: (020) 4999 999.
Commissioner for Domestic Taxes