How to calculate and pay MRI tax in Kenya
If you rent out residential property in Kenya, you probably owe Monthly Rental Income tax. It is 7.5% of the rent you collect, filed and paid by the 20th of the next month. Here is how it works, in plain language.
What MRI is
MRI stands for Monthly Rental Income. It replaced the old habit of waiting until the end of the year to declare rent. Each month you add up the residential rent you actually received, multiply by 7.5%, file a short return and pay.
Who pays it
- A resident person or company that collects residential rent.
- Yearly gross rent above KES 288,000 and up to KES 15,000,000.
- Not for commercial premises, which are treated differently. Above KES 15,000,000 a year, residential rent is declared in an annual return instead.
How to calculate it
Take the gross rent received in the month. Do not subtract repairs, caretaker pay, rates or loan interest. Multiply by 0.075.
| Rent received | Calculation | MRI to pay |
|---|---|---|
| KES 60,000 | 60,000 × 7.5% | KES 4,500 |
| KES 120,000 | 120,000 × 7.5% | KES 9,000 |
| KES 300,000 | 300,000 × 7.5% | KES 22,500 |
Skip the arithmetic with the free MRI calculator.
How to file and pay
- Add up the month’s rent from every residential house you let out.
- Log in to KRA iTax with your PIN and file the Monthly Rental Income return for the month.
- Generate the payment registration number (PRN) for the amount due.
- Pay before the 20th through M-Pesa or your bank using the PRN.
- Keep the acknowledgement and payment slip with your records.
Always follow the current steps shown on iTax and KRA’s website, because screens and payment channels are updated from time to time.
Common mistakes landlords make
- Forgetting NIL returns in months with no rent.
- Using the rent that was due rather than the rent actually received.
- Missing the 20th because the month’s M-Pesa messages were never added up.
- Mixing personal and rent money in one M-Pesa line, which makes the total hard to prove.
The fix for all four is the same: record every payment as it arrives. See how to collect rent with M-Pesa to keep clean records from day one.
Frequently asked questions
What is MRI tax?
Monthly Rental Income tax is a simplified tax on residential rent. You pay a flat percentage of the gross rent you collect each month instead of working out profit at the end of the year.
What is the MRI rate in 2026?
7.5% of gross residential rent. It applies when your yearly rent is above KES 288,000 and not more than KES 15,000,000.
Can I deduct expenses from MRI?
No. MRI is charged on the gross rent collected. If you prefer to be taxed on profit after expenses, you would need to look at the annual return route; ask KRA or a tax adviser whether that is open to you.
What if I collected no rent this month?
File a NIL return for the month. Skipping the return can bring penalties even when no tax is due.
Kodi’s landlord reports show the rent collected in each month and the MRI worked out on it, so you are never adding up M-Pesa messages on the 19th. See landlord reports.
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