Factors Affecting Compliance on Rental Income Tax Policy by Landlords in Nakuru Municipality
Amon G. Thananga, Daniel M. Wanyoike, Antony J. Wagoki
Journal of Agriculture and Environmental Sciences, 2(1), pp. 26-38.

Taxation is the primary source of revenue for governments throughout the world to implement their social and political agendas and to deliver services to the citizens. In Kenya, increased government expenditure and the need to finance government activities using local sources of funds has called for the government to bring into the tax net sectors that have remained untaxed before. In 2012/2013 budget speech a lot of emphasis was put that rental income was subject to taxation. Previous statistics indicated that less than half of landlords and developers had complied with tax requirements. This study was carried out to establish how landlords had responded to the new taxation measures, and the factors that influenced their compliance such as perception, taxation knowledge gaps and cost of compliance to rental income tax among landlords in Nakuru Municipality. A sample of 94 respondents was chosen to take part in the study using convenience sampling technique. Primary data was collected by seeking opinion from chosen landlords using questionnaires. Results of the research show that, the level of full compliance to the provisions of the rental income tax policy was low. Only 39.0% of the landlords indicated that they fully complied with the provisions. The most common form of noncompliance was through overstatement of expenses and deductions that would in turn reduce taxable pay and the amount of tax, similarly understatement of incomes was also common. Most of the landlords avoided the outright non-compliance where they did not submit returns or pay taxes at all instead they had irregular payment and tax reduction. The study recommended that Kenya Revenue Authority should embark on public awareness campaigns to educate the public on their role and responsibilities in taxation rather than approaching the matter from a legal obligation perspective. This would create a sense of responsibility in compliance rather than fear for non-compliance. Putting in place active customer oriented information desk was also found to be necessary.

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Thananga, G. Amon., Wanyoike, M. Daniel., & Wagoki, J. Antony. (2013). Factors Affecting Compliance on Rental Income Tax Policy by Landlords in Nakuru Municipality. Journal of Agriculture and Environmental Sciences, 2(1), pp. 26-38.

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Senior Accountant
The National Treasury of Kenya
P.O. Box 17217- 20100
Nakuru – Kenya
Mobile +254-722441123
E-mail: amonthananga@gmail.com or amongitau@yahoo.com
Amon G. Thananga is a senior accountant at The National Treasury of Kenya. His Carrier spans in accounting. He is a Certified Public Accountant of Kenya, having completed CPA examinations in 2006. Amon completed Bachelor of Business Administration at Kenya Methodist University in 2011. At the University of Jomo Kenyatta University of Agriculture and Technology, Kenya he earned an MBA in finance in 2013.
His research interest is on the impact of taxation on the tax payers.


Daniel Mungai Wanyoike
Department of Entrepreneurship and Procurement
School of Human Resource Development
Jomo Kenyatta University of Agriculture and Technology (JKUAT)
P.O. Box 16530-20100, Nakuru, Kenya
Mobile: +254-720390894
Email: dwanyoike@jkuat.ac.ke ordanwanyoike@gmail.com

Daniel Wanyoike is currently pursuing PhD in Entrepreneurship at Jomo Kenyatta University of Agriculture and Technology (JKUAT) where he has submitted thesis for examination (Thesis title: “Determinants of Information Communication Technology Adoption by Formal Small Enterprises in Urban Kenya.”). He has a masters in business administration (entrepreneurship option)from Stephens College (USA) and a bachelors in Food Science and Technologyfrom University of Nairobi. Currently he is a lecturer at JKUAT where he has successfully supervised and mentored students to complete undergraduate and Masters’ Projects in the areas of Small Enterprise Development: Frameworks for Policy and Strategy, Managing Small Enterprise, System Dynamics and Corporate Strategy, Entrepreneurship, Strategic Management, Technology and Innovation, Innovation and Change, Project Monitoring Control and Evaluation among others.


Anthony Juma Wagoki
Lecturer, Entrepreneurship & Procurement Department
Director, JKUAT Nakuru Campus
Jomo Kenyatta University of Agriculture and Technology
P. O. Box 1063-20100 Nakuru, Tel. +254-051-2216660, Fax +254-67-52164
Cell phone: +254-722-849765/254-772-149335
Email: wagoki@jkuat.ac.ke; directornakurucbd@jkuat.ac.ke
Juma Wagoki is currently pursuing PhD in Marketing Management at Jomo Kenyatta University of Agriculture and Technology (JKUAT). He has a masters in Business Administration from Nairobi University and bachelors in business administration from Kenyatta University. He is currently a lecturer at JKUAT and Director of Nakuru Campus. His teaching and research areas are in Strategic marketing, Consumer Behavior, Marketing Planning, Industrial Marketing, Relationship marketing, Strategic Human resource Management, strategic management, Retail Marketing and Enterprise Development.