HARARE – Finance Minister Mthuli Ncube has proposed amendments to Zimbabwe’s Rental Income Tax legislation, aiming to close loopholes that allow business activities in commercial and non-commercial properties to escape the tax net.
Speaking recently, Ncube highlighted that despite existing presumptive tax provisions, many property owners, managers, and tenants remain unregistered for tax, with informal arrangements and unaccounted rent payments undermining revenue collection.
“The existing legislation prohibits deduction of rent paid to unregistered property owners and managers,” Ncube said. “However, it does not adequately address situations where buildings are managed informally, or where property owners and managers collect rent but fail to remit it to ZIMRA.”
He also noted that property owners and managers are not withholding specified presumptive taxes when tenants fail to voluntarily comply with their tax obligations, further limiting the effectiveness of current measures.
To strengthen the framework, Ncube proposed that legislation be amended to: Mandate registration with ZIMRA of all commercial and non-commercial properties where business activities are conducted. Compel property owners and managers to submit quarterly tenant reports, detailing businesses operating on their premises.
In addition, he suggested that property owners or managers who fail to comply with the new requirements—including registering for Rental Income Tax and withholding 10% of rental income from informal sector operators—face penalties equivalent to the unpaid Rental Income Tax and Presumptive Tax, plus interest.
Ncube further proposed empowering ZIMRA to temporarily close business premises that fail to comply with the new regulations until all compliance processes are completed. These measures are slated to take effect from 1 January 2026.
The proposals are expected to significantly enhance revenue collection from rental income, particularly from informal and unregistered businesses, and tighten oversight of property management practices across Zimbabwe.
