What you need to know about withholding tax on rental income in 2025

If you own real estate and earn income from renting it out, it is essential to stay informed about the latest legal changes regarding withholding tax. Starting from January 1, 2025, the new "income tax law" introduces new regulations that directly impact both tenants and landlords.

 

What is withholding tax?

Withholding tax is a tax that is deducted at the time of income payment. In the case of rental income, the tenant is responsible for withholding and declaring this tax on behalf of the landlord.

 

What changes in 2025?

One of the main changes is that the withholding tax declaration must now include the details of the individual or entity receiving the rental income. This means that, in addition to the tenant’s information, the following details must also be provided:

• For individuals: full name and national identification number (nid).
• For businesses: taxpayer identification number (nipt).

If these details are incorrect, the system will immediately notify the need for correction.

 

When is the declaration deadline?

The withholding tax declaration for the previous month's income must be submitted by the 20th of each month.

 

Tax rate

The withholding tax rate on rental income is 15%, in accordance with article 58 of the "income tax law."

 

How does this affect real estate investors?

These legal changes aim to increase transparency and tax compliance. For real estate investors, it is crucial to be prepared and consult with professionals to avoid penalties.

If you are investing in rental properties, keep these new legal obligations in mind to maximize your profits while staying compliant with the law.

 

How can we help?

On our real estate advertising platform, we not only offer a variety of opportunities to find the perfect investment property but also keep you informed about legal changes that may impact your investments.

Contact us for more advice and list your property today!

 

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