How to Easily Pay Rental Income Tax Using Government Paybill 222222

Property owners in Kenya must pay their Rental Income Tax, but the process is often seen as lengthy and complex. To simplify and make it more transparent, the government has introduced Paybill number 222222 for all government services, including the payment of rental income tax.

Lower Tax Rate: The government has reduced the rental income tax rate from 10% to 7.5% on the gross rent received, a change that landlords appreciate.

Monthly Rental Income (MRI) Registration: Landlords need to register for Monthly Rental Income (MRI) before submitting their rental income tax. This tax applies to rental income exceeding Ksh280,000 but below Ksh15 million annually.

Steps to Register a Property for MRI:

Visit www.itax.kra.go.ke.
Go to the registration tab and select "Register Property details."
Fill in the required details based on the property type.
Provide the PIN of a tenant for the property.
The system will fill in your details automatically.
Enter the necessary information, including estimated monthly rent.
Add any remarks and submit them to receive an acknowledgement receipt.

Filing Returns for Registered Landlords:

Log in to www.itax.kra.go.ke.
Under the returns tab, click on "File Return."
Choose the obligation "Income Tax - Rental Income" and proceed.
Select whether it's an Original or Amended Return.
Enter monthly rental income, and the system will calculate the tax.
Click "Submit."

Paying Rental Income Tax:

Generate a payment slip through www.itax.kra.go.ke.
Under Payments, select "New Payment Registration."
Choose Income Tax as the tax head and Income Tax - Rent as the sub-head.
Select payment type as Self-Assessment Tax.
Enter tax periods and payment mode through Paybill.
Submit and retrieve a unique payment registration number for mobile payment.

Mobile Payment Options:

Via SIM Toolkit:

Enter Paybill 222222.
Use the Payment Registration Number (PRN) as the account number.
Enter the amount, PIN, and send.
Alternatively, use USSD:
Dial *222#.
Choose "Pay KRA bill."
Enter the E-slip (PRN) number.
Select payment mode M-PESA.
Enter the M-PESA pin and complete the process.

Important Notes:

Rental Income is filed by the 20th of the following month.
For months without rent, landlords must file a NIL return.
Residential rental income is a final tax and does not need to be declared in annual income tax returns.

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