Ghana has millions of landlords — from those renting out a single room to those managing multiple properties. Yet compliance with rental income tax is one of the lowest in the country. GRA has been increasingly active in identifying rental income earners through bank records, utilities, and tenancy agreements. Here's what every landlord needs to know.
The Tax Rate on Rental Income
For individuals receiving rental income in Ghana, the tax treatment is:
- Flat rate: 8% of gross rental income — this is a final withholding tax
- No deductions are available under the flat rate regime for individuals
- The 8% must be withheld by the tenant (if the tenant is a company or individual paying rent to an individual) and remitted to GRA
- If the tenant is an individual renting from another individual, the landlord must self-declare and pay
Who Withholds the Tax?
The withholding obligation depends on who is paying the rent:
- Company or institution paying rent to an individual: The company must withhold 8% and remit to GRA monthly. The landlord receives 92% of rent.
- Individual tenant paying individual landlord: No withholding at source — the landlord must self-declare and pay the 8% to GRA.
For Companies (Corporate Landlords)
Companies that own rental properties are taxed on rental income as part of their normal corporate income tax at 25%. However, companies can deduct allowable expenses:
- Property management fees
- Maintenance and repairs (not capital improvements)
- Ground rent
- Insurance premiums
- Depreciation allowances on the building
How to Declare Rental Income as an Individual
- Obtain a TIN from GRA (if not already registered)
- At year-end, complete a self-assessment tax return showing total rental income received
- Calculate 8% of gross rental income
- Deduct any withholding tax already paid on your behalf (by company tenants)
- Pay the balance to GRA
GRA Enforcement
GRA has been expanding its rental income enforcement:
- Cross-referencing tenancy agreements lodged with courts
- Using utility connections to identify rental properties
- Bank records showing regular rent receipts
- Anonymous tip-offs from tenants
Landlords caught with undeclared rental income face back taxes for up to 6 years, plus interest and penalties of up to 300% of the unpaid tax in serious cases.
Advance Rent and Tax Timing
Advance rent received (e.g., 2 years paid upfront) is taxable in the year received — not spread over the rental period. This creates a cash flow challenge for landlords who spend the advance rent but face a tax bill in the same year.
Use our free Land Deal Risk Check before investing in rental property. Read about rent advance laws and capital gains tax on selling.
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