Kenya Revenue Authority (KRA) Launches an Online System to Monitor Landlords Taxes

Kenya Revenue Authority (KRA) has launched a new online system to monitor and help landlords pay their rental income taxes more easily. This system is called the Electronic Rental Income Tax System, or eRITS for short. It is a big step in making tax payments simpler and faster for property owners in Kenya.

The eRITS system can be accessed through two popular online platforms: Gava Connect and eCitizen. Many Kenyans already use these platforms for different government services, so it will be easy for landlords to use eRITS too. The system connects directly with KRA’s digital services, which means landlords can calculate their taxes, file their returns, and pay the monthly rental income tax all in one place.

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Since 2016, landlords who earn between about KES 288,000 (around $2,200) and KES 15 million (about $115,000) a year from rent have been required to pay Monthly Rental Income (MRI) tax. Starting January 2024, the government lowered this tax rate from 10% to 7.5% to help reduce the amount landlords have to pay. The new online system is designed to make it easier for landlords to follow these tax rules without much hassle.

In the last financial year, the government collected over KES 14 billion (about $111 million) from this rental tax. This was more than the previous years, showing that more landlords are paying their taxes. The new system is expected to help increase compliance even more.

Experts say this new system is a good idea. Alex Mathini, a tax expert in Kenya, said that even though using eRITS is not required, it is a good idea to use it because it makes paying taxes easier. Another expert, Andrew Oduor, said that KRA has not yet shared detailed instructions on how to sign up for the system, but once landlords register, they will be able to file their monthly tax returns online. These returns will automatically be part of their overall tax records, making the yearly tax filing simpler.

One challenge is that the eRITS system only works online through Gava Connect and eCitizen. This means landlords need internet access to use it. Some landlords who don’t have good internet might find it hard to use the system.

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The Kenya Revenue Authority’s Electronic Rental Income Tax System is a big help for landlords. It makes paying rental income tax easier, faster, and less stressful. As more landlords start using eRITS, it will help improve tax collection and support the country’s growth. This new system shows how KRA is using technology to make life easier for taxpayers.

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