Rental income tax administration in Uganda: Weighing a shift to monthly provisional returns

By Hamza M Ssali

In the coming financial year’s national budget, myriad tax amendments have been tabled before the 11th Parliament as part of the government’s revenue-mobilisation strategy.

One proposal would require individual landlords to file provisional rental income tax returns every month, raising questions about practicality, compliance costs, and housing affordability.

Put simply, shifting individual landlords to monthly provisional rental returns is likely to raise compliance costs and either encourage informality or push costs into rents, with uncertain net revenue gains.

If the objective is to broaden the tax base, the government should prioritise simplification, better taxpayer identification, and stronger enforcement rather than higher filing frequency.

The government’s focus on rental income tax is unmistakable. Proposals targeting this sector have been recurring almost annually, raising a central question: is the pressure driven mainly by non-compliance, gaps in taxpayer identification, or administrative weaknesses in enforcement?

The key issue is whether the proposed monthly filing will address the root problem—or simply add cost and complexity for compliant landlords.


There is also a structural concern. Under Uganda’s rental tax regime, landlords pay tax before fully recovering investment costs. In a capital‑intensive sector, any additional compliance burden should therefore be weighed against housing supply and affordability objectives.

Under Uganda’s general income‑tax administration rules, individuals typically pay provisional income tax in four instalments. Moving rental income tax reporting to a monthly cycle would therefore represent a sharp increase in filing frequency for individual landlords.

This proposal also matters in the context of Kampala Metropolitan Area’s housing pressures. Uganda’s housing deficit is widely cited at about 2.4 million units, while annual supply is often reported at about 60,000 units—implying a persistent shortfall as urbanisation accelerates.

Looking beyond Uganda, Kenya has a similar model to what is being proposed in Uganda. The Kenya Revenue Authority administers a simplified Residential Rental Income Tax under which eligible landlords pay a flat tax on gross rent of 7.5%.

The regime applies to landlords with annual gross rental income of KES 288,000 but not exceeding  KES 15 million. Returns and remittances are made monthly, within five working days after month end.  

Rwanda takes a different approach: rental income tax for individuals is administered through local government taxes.

Landlords submit a copy of the written rental contract within 15 days of signing and file an annual rental income tax declaration through the automated local government tax system.

Uganda can borrow from the “provincial tax system” thinking—similar to Rwanda, without duplicating institutions—by giving local governments a stronger role in identifying rental properties and landlords, maintaining property and occupancy registers, and supporting verification.

The tax authority would retain responsibility for tax rules, e‑filing, and payments, while local governments focus on improving data quality (linking properties to owners, addresses, and service connections).

With clear data‑sharing and a Kampala Metropolitan pilot, this approach could expand the base and improve compliance without blanket monthly reporting for every landlord.

In conclusion, while the government’s aim of improving rental income tax compliance is understandable, a blanket move to monthly provisional returns for individual landlords may be more burdensome than beneficial.

A better path is to broaden the tax base through stronger property and rental registers, simpler processes, and targeted compliance measures—then reassess filing frequency based on evidence.

The writer is a Senior Manager, Tax at EY, Kampala.

The views indicated in this article are my individual views and not the views of Ernst & Young Uganda.