How to File KRA Rental Income Tax (MRI) on iTax

Tax season hits different when you're a landlord.

You've got M-Pesa statements everywhere. A notebook with scribbled rent amounts. And that nagging feeling that KRA is watching.

Here's the thing: filing rental income tax in Kenya isn't as scary as it looks. It's one short return a month on iTax, and once you've done it twice it's routine.

This is the whole process, click by click, using KRA's own steps.

Table of Contents

• First: Does MRI Apply to You?
• Before You Start
• Step 1: Register Your Property (Once)
• Step 2: File the Monthly Return
• Step 3: Generate the Payment Slip
• Step 4: Pay
• Step 5: Check It Went Through
• Months With No Rent: File a NIL Return
• Common iTax Errors and How to Fix Them
• Common Mistakes Landlords Make
• Penalties for Late Filing or Payment
• Your Monthly Filing Checklist
• Keeping Records for KRA
• Using Software to Simplify MRI Filing
• Getting Help From KRA
• Next Steps

First: Does MRI Apply to You?

The tax is Monthly Rental Income (MRI) tax. Three things decide whether it's yours to file:

• It's for residential rent. Houses, flats, bedsitters, rooms. Commercial rent (shops, offices) is taxed differently, through your annual return.
• It applies when your rent is more than KES 288,000 and not more than KES 15 million a YEAR. Not a month. Roughly KES 24,000 to KES 1.25 million a month.
• It's 7.5% of the gross rent you received, with no deductions, and it's a final tax.

So a single flat let at KES 30,000 a month (KES 360,000 a year) is inside MRI and owes KES 2,250 a month.

The threshold being yearly is the mistake almost everyone makes. If you want the full explanation, read what KRA MRI tax is. The rest of this guide is the filing itself.

Before You Start

Have these ready:

• Your KRA PIN and iTax password
• The phone registered on iTax, for the one-time code
• The total rent you received last month, from every property
• A tenant's KRA PIN, if you're registering a property for the first time

Deadline: on or before the 20th of the following month. January's rent is filed and paid by February 20th.

Step 1: Register Your Property (Once)

You only do this the first time, or when a property changes.

1. Log into iTax
2. Open the Registration tab and pick the very last option, Register Property Details, then click Next
3. Section A fills itself in with your details. In Section B, choose New property
4. Enter the KRA PIN of a tenant in that property. iTax fills in the name for you
5. Fill in the property details and an estimated monthly rental income, then click Add
6. Add any remarks under Application Remarks and click Submit

You'll get an Acknowledgement Receipt. Keep it.

The same screen has Update property for changes and Deregister property if you sell or stop letting.

Step 2: File the Monthly Return

Do this every month.

1. Log into iTax
2. Open the Returns tab and click File Return
3. Select the obligation Income Tax - Rental Income
4. In Section A, choose Original Return (or Amended, if you're correcting one you already filed)
5. Pick the period: the previous month. Filing in March? Select February
6. In Section B, your number of properties fills in from your registration. Enter the month's rental income
7. iTax calculates the tax for you
8. Click Submit

Save the acknowledgement.

If a tenant deducted tax from your rent and remitted it to KRA, iTax pulls those withholding credits in automatically and reduces what you owe.

What to enter as rental income: the gross rent you actually received that month, from all your residential properties added together. Not what you invoiced. Late rent counts in the month it arrives.

Example:

• Unit A paid KES 25,000
• Unit B paid KES 30,000
• Unit C paid KES 25,000 (including KES 5,000 owed from last month)
• Enter: KES 80,000. Tax: KES 80,000 × 7.5% = KES 6,000

Step 3: Generate the Payment Slip

Filing isn't paying. You still need a payment slip.

1. Open the Payments tab and choose New Payment Registration
2. Tax head: Income Tax. Tax sub-head: Income tax - rent
3. Payment type: Self-Assessment Tax (because the return is already filed)
4. Enter the tax period (year and month), select it, and click Add
5. Choose your payment mode and generate the slip

The slip carries a Payment Registration Number (PRN). You need it to pay.

Step 4: Pay

M-Pesa:

1. Lipa na M-PESA, then Pay Bill
2. Business number: 572572
3. Account number: your PRN
4. Amount, then your PIN

You can also pay at a KRA partner bank with the slip, or through your bank's app or internet banking using the PRN.

Step 5: Check It Went Through

Give it a day or two, then log back into iTax and look under Payments for the payment against that return.

Not showing after 48 hours? Check the PRN on your receipt first. Most "missing" payments went to a mistyped PRN.

Months With No Rent: File a NIL Return

Vacant all month, or nobody paid? KRA says to file a NIL return for any month you received no rent.

Same steps as above, with zero as the rental income. No tax, but the return is filed, and your record stays unbroken.

This is the only reason to file nil. It's not something you do because you're "under the threshold".

Common iTax Errors and How to Fix Them

"Invalid Tax Obligation" Your PIN isn't set up for rental income yet. Do Step 1 first, then come back.

"Return Already Filed" You've already filed for that month. If the figure was wrong, file an Amended return for the same period instead of a new one.

"Invalid Period" You picked the current month. Choose the previous month.

Payment not reflecting Wrong PRN, or still processing. Check the PRN on your receipt and wait 48 hours before chasing it.

Wrong amount filed File an Amended return for that period with the right figure.

Common Mistakes Landlords Make

I've seen these too many times:

1. Treating the threshold as monthly It's KES 288,000 a year. A landlord collecting KES 50,000 a month is well inside MRI.

2. Reporting invoiced rent instead of received rent If a tenant didn't pay, don't include it. Declare it in the month it actually arrives.

3. Filing without paying The return and the payment are two separate steps. A filed return with no payment still attracts late payment penalties.

4. Missing the 20th It sneaks up fast. File by the 10th and the deadline never bites.

5. Mixing up commercial and residential rent MRI is residential only. Commercial rent goes in your annual return.

Penalties for Late Filing or Payment

From KRA:

Late? File and pay anyway, the same way. Paying the tax stops the interest growing.

Your Monthly Filing Checklist

By the 5th:

• Reconcile last month's rent against your M-Pesa and bank records
• Total the rent actually received

By the 10th:

• File the return on iTax
• Generate the payment slip and pay
• Save the acknowledgement and payment receipt

By the 15th:

• Confirm the payment shows on iTax

The 20th:

• Deadline. You should already be done.

Keeping Records for KRA

Keep these for 5 years:

• Rent receipts or payment confirmations
• M-Pesa statements showing rent payments
• Bank statements with rent deposits
• Tenancy agreements for each unit
• Each month's iTax acknowledgement, payment slip and payment receipt

Digital copies are fine, as long as they're backed up.

Using Software to Simplify MRI Filing

The filing takes five minutes. Working out the number takes hours, if you're cross-referencing M-Pesa messages, bank statements and a notebook.

KodiSawa records every rent payment as it arrives and matches it to the tenant, so your monthly total is already there on filing day.

No more:

• Scrolling through hundreds of M-Pesa messages
• Manual calculations
• Missed payments slipping through the cracks

Getting Help From KRA

• Phone: +254 20 4 999 999 or +254 711 099 999
• Email: callcentre@kra.go.ke
• Or visit a KRA office with your ID and PIN

Next Steps

1. Check your yearly rent against the KES 288,000 to 15 million band
2. Register your property on iTax if you haven't
3. Put the 10th of every month in your calendar
4. Set up a way to see your monthly rent total without digging for it

Filing rental income tax doesn't have to be stressful. It's one return, once a month.

Simplify your MRI filing. KodiSawa tracks rent automatically and gives you the monthly figure KRA asks for. Try it free for 14 days.