KRA nets Sh10bn rent income tax

Times Tower, the headquarters of the KRA, in Nairobi. FILE PHOTO | NMG

What you need to know:

  • KRA collects Sh400 million per month, translating to Sh4.8 billion per year.

The taxman has collected Sh10 billion from landlords since a law that requires them to pay taxes on earnings came into force in January last year.

The Kenya Revenue Authority (KRA) said on Tuesday it has on board 52,000 landlords — slightly over 50 per cent of the targeted 100,000.

The authority said it collects Sh400 million per month, translating to Sh4.8 billion per year.

“We have partnered with other relevant government institutions such as Kenya Bureau of Statistics, Kenya Property Developers Association and the Ministry of Lands, Housing and Urban Development to be able get more landlords who are not in our data base. Our target is to recruit 20,000 new landlords in the financial year 2016/2017,” said KRA manager in-charge of real estate Alice Kiptoo.

She spoke during a media sensitisation workshop on Rental Income and Capital Gains Tax at a Nairobi hotel.

Ms Kitoo attributed low compliance among payers to complex taxation system, poor record keeping, informal operations by players and a lack of awareness about the law.

Data from the KRA estimates that there are about 100,000 landlords in the country with about 80 per cent in Nairobi County.

Rental income tax is the amount one pays to the government for earnings derived from the use of residential property.

It was introduced by the Finance Act 2015.