Rental Income Withholding Tax Kenya

Nonresidents are generally subject to withholding taxes which serve as their final tax liability.

Rental income withholding tax kenya. For all commercial rental income there are provisions to withhold some of the rent as income tax to be remitted to kra as tax paid by the taxpayer in advance. Deducted and remitted on or before the 20th of the following month. Withholding tax is not a final tax. Either 5 of the tax payable or twenty thousand shillings.

No kenya tax is due if subject to tax in zambia. Learning how to file your returns in kenya could never be simpler. Rental income tax rate in kenya. Kra withholding tax rates.

Annual rental income less than kshs 10 million. 10 million per annum. This is tax payable by resident persons individual or company on rental income earned for the use or occupation of a residential property where the rent income is between kshs. Withholding tax on rental income rental payments to a resident landlord.

For a resident landlord 10 of the rental income to resident landlords is withheld by the tenants who are appointed as withholding agents by kra. A rate of 10 is applicable where the beneficial owner is a company other than a partnership that directly or indirectly holds less than 10 of the capital of the company paying the dividends. 12 000 per month and kshs. The percentage deducted varies between incomes and is dependent on whether you are a resident or non resident.

Rental income nonresidents earning rental income from real properties is subject to a withholding tax at a rate of 10 on the gross rental income received. 8 if the beneficiary holds at least 25 of the capital of the company paying the dividends. One is required to declare the income and the withholding tax certificates upon filing individual tax returns and pay any tax due what is the penalty for late filing. Taxpayers may elect to be taxed on their net income at a flat rate of 30.

This simply means that 10 of the money you make from your rental properties belongs to the government. The finance act 2016 introduced the provision of levying withholding tax wht on rental income whereby a tenant or an agent appointed in writing by the commissioner is required to withhold 10 wht on all rental payments including premium or similar consideration made to a resident landlord for the use or occupation. Kra withholding tax rates this is a method whereby the payer of certain incomes is responsible for deducting tax at source from payments made and remitting the deducted tax to kra. The interest is capped at the value of the principal tax while the withholding tax penalty is limited to shs 1 million currently there is no clarity on how the 10 tax on residential rental income will be paid where the.

Rental income taxation in kenya is currently at the rate of ten percent 10. However for taxation of residential rental income the annual rental income categorized into two. Tax due and interest at the rate of 1 of per month until the tax is paid.