The Kenya Revenue Authority (KRA) is now targeting landlords who ‘have not’ raised their rent over the past couple of years.

According to the KRA, the failure by these landlords to raise rent is suspicious and points to a deliberate attempt at cheating the taxman when filing returns.

The KRA says that these landlords have been reporting the same figures or slightly lower figures for some time now, despite rent being an appreciative commodity.

A landlord who has been target by the taxman shared a message they received from the KRA with a local newspaper. In the message, KRA questioned why they had filed for a decline in rental income.

“The commissioner has noted your rental income has been a constant figure or with a slight decline for the periods filed. We understand rent is an appreciating commodity with economic times and we expect your declarations for the current month will reflect that and if any previous returns declarations can be amended as need be. Filing of Nil or decline in rental income is highly discouraged,” the KRA said in the message that was shared by the newspaper.

However, landlords are protesting the move by the taxman, arguing that rental income does not grow overnight. They say that rental income is dependent on factors including type of tenants, landlord-tenant relationships, and how long the tenants have occupied the property.

KRA goes after rent, gross sales of small businesses in hunt for housing tax

According to the KRA, the rate of monthly rent income tax is 7.5 per cent, effective from 1 January 2024, on the gross rent received and is final tax. No expenses, losses or capital deductions are allowed for deduction from the gross rent.

“Monthly rental income tax is applicable to persons earning rental income which is in excess of two hundred and eighty thousand shillings but does not exceed fifteen million shillings during any year of income,” the KRA states.