Landlords who keep good records pay the right tax, win disputes with tenants and sell their property for more because the paperwork is clean. Landlords who do not keep them end up reconstructing a year of rent from bank statements and memory. This guide lists what to keep and a simple way to do it.

Records about the property

  • The title deed or lease, the sale agreement and proof of what you paid when you bought it
  • Stamp duty and legal fee receipts, which form part of your cost if you sell later; see stamp duty on property transfers
  • Receipts for improvements, such as an extra floor or a new roof, which count toward your cost for capital gains
  • Insurance policies, land rates receipts and clearance certificates

Records about each tenant

  • The signed tenancy agreement and any renewals
  • The tenant's identity, KRA PIN if a business, phone and emergency contact
  • The deposit received, where it is held and any deductions when it is returned; see rent receipts and tenant deposits
  • A numbered rent receipt for every payment, including M-Pesa

Records of money in and out

  • Bank and M-Pesa statements, kept in month order
  • The agent's monthly statements, if you use one, showing rent collected, fees deducted and tax withheld
  • Invoices and receipts for every expense: repairs, agent fees, insurance, security, rates and interest on any loan

Records for tax

  • Your monthly rental income returns and payment receipts, or your annual return
  • Withholding tax certificates from tenants who withhold; see withholding tax on rent
  • Your KRA PIN registration and any correspondence with KRA

How long to keep them

Keep tax records for at least five years after the year they relate to. Keep records of the purchase and improvements for as long as you own the property and five years after you sell it, because they decide the gain you are taxed on.

A system that works

  1. Use one folder per property, with sub-folders for the lease, tenants, expenses and tax.
  2. Record rent the day it arrives. The free rent receipt book issues numbered receipts and totals the rent received, and the free rental property and tenant register lists each unit, tenant and lease end date.
  3. Track the tax. The free monthly rental income (MRI) tracker works out the tax each month, and the tax payments log keeps the payment receipts.
  4. Reconcile monthly. Match the rent you expect against bank and M-Pesa statements and chase any gap.
  5. Photograph paper receipts and store them in the right folder.

Why it pays off

Good records let you choose the cheaper tax route with confidence; see monthly rental income tax or annual tax. They also make it easy to file; read how to file a monthly rental income return. If you want to see how much tax a month's rent will bring, the rental income tax calculator does the sum, and the business records guide has more on retention.

Requirements can change. Confirm what KRA expects with a registered tax agent or on kra.go.ke.

Common questions

How long should a landlord keep rental records? Keep them for at least five years after the year to which they relate, because KRA can review returns for that period. Keep leases for the life of the tenancy plus the same period afterwards.

Are digital copies acceptable? Yes, provided they are complete, legible and can be produced when asked. Scan paper documents, keep them in clearly named folders by year and back them up, along with bank and M-Pesa statements.

Which records matter most if KRA asks questions? The tenancy agreements, a rent register showing every payment, the monthly rental income returns and payment slips, any withholding tax certificates, and invoices for expenses if you are taxed on profit.