Zimbabwe’s property sector is entering a new phase of tax compliance following the introduction of enhanced rental income measures by the Zimbabwe Revenue Authority (ZIMRA), with experts saying the changes are less about new taxation and more about widening the tax net and formalising the market.
The tax, which took effect on January 1, 2026, specifically targets landlords leasing to commercial tenants and marks a significant shift in how the fiscus monitors and collects revenue from the property sector.
“The Zimbabwe Revenue Authority (ZIMRA) invites all taxpayers to review their tax affairs and voluntarily disclose any income that was not declared or tax obligations that were not complied with during the 2025 year of assessment,” the tax authority said in a public notice.
“This initiative is meant to encourage voluntary compliance and allow taxpayers to regularise their tax affairs without unnecessary disruption to their business operations.”
The voluntary disclosure opportunity expires on May 30, 2026, and after that date, ZIMRA says any non-compliance identified will be treated in accordance with the full provisions of the law, including penalties and possible prosecution.
“Under the programme, taxpayers who make a full and truthful disclosure will have penalties waived in full, although interest on outstanding amounts will still apply. Importantly, such disclosures will not automatically trigger audits or criminal proceedings,” it said.
The scope of the amnesty is broad, covering individuals and businesses across all sectors, including micro, small, medium and large enterprises, as well as participants in the informal economy.
Property expert Kura Chihota says the presumptive tax framework being applied to parts of the rental sector is often misunderstood.
In essence, he said, it is not designed to burden already compliant businesses, but to capture operators who have remained outside the formal tax system.
“By its nature, a presumptive tax implies that you were not in the tax net. So if you are Mashonaland Holdings or First Mutual Properties and you have a tax number and you are paying your tax as a normal company, you are not affected,” he said.
He noted that the focus is on previously unregistered property owners who have converted assets into income-generating commercial ventures without formalising their tax obligations.
“This is not a new tax, but is for the new player who bought a shop, turned it into a mall and is collecting commercial rentals without registering with ZIMRA. The authorities are essentially saying: because you are outside known parameters, we will presume your income and apply tax obligations accordingly,” said Mr Chihota.
Under this system, ZIMRA estimates rental income where records are absent, effectively bringing informal operators into compliance.
The measures are targeted specifically at commercial and service-use properties, with residential landlords largely excluded.
Mr Chihota believes the move will improve transparency across the sector and will make the industry generally more compliant.
“Managing agents who collect rentals on behalf of owners will need to be transparent about tax positions, and property owners themselves must engage with ZIMRA,” he says.
Mr Chihota adds that the voluntary disclosure window is designed to ease this transition. “The offer by ZIMRA is trying to reduce non-compliance and encourage people to come forward. Non-compliance can lead to recovery of unpaid tax, a 100 percent penalty and possible closure of premises,” said Mr Chihota.
Tax policy expert Susan Tafadzwa Chirikure, Founder and Principal Consultant at ELIM Business Tax Solutions, places the developments within a broader economic context, arguing that tax compliance is a fundamental pillar of a functioning market system.
“Tax compliance is a shared foundation of any functioning economy. Every citizen has a duty to pay the correct taxes.
This responsibility has always existed and applies to everyone – landlords, tenants, companies, trusts and professionals alike,” she says.
According to Ms Chirikure, the current shift is not about creating new legal duties but about using technology to improve enforcement and ensure uniformity.
“Only ZIMRA knows the full extent of its verification capacity, but we are clearly seeing a push for greater transparency in how tax is declared. The new digital systems support existing laws – they don’t create new ones – but they do bring much-needed consistency across the market,” she notes.
Ms Chirikure highlights the growing role of digital integration, particularly the linking of property and asset registries with ZIMRA’s tax systems, which will enable more data-driven compliance monitoring.
“Digitalisation is moving forward. By connecting the Deeds Registry, the Central Vehicle Registry and ZIMRA systems, authorities can link assets to taxpayer identification numbers. Lifestyle audits will increasingly rely on hard data rather than assumptions. The question is not whether records will eventually connect, but when,” she says.
In addition, Ms Chirikure said fiscalisation measures are embedding tax compliance directly into transactions, and rental payments are increasingly traceable, with withholding tax mechanisms placing responsibility on both tenants and landlords.
“Compliance is being built into the transaction itself,” Ms Chirikure explains. “Business tenants withhold tax on rent, landlords have duties regarding informal tenants, and companies must name their landlords to claim deductions.
This means compliance becomes part of the normal process.”
Ms Chirikure points to ZIMRA’s Voluntary Disclosure Programme as a practical way for taxpayers to get their affairs in order.
“The programme allows people to regularise without facing penalties and to pay in instalments. The alternative is much worse – penalties, interest, garnishee orders, seizure of property and even prosecution,” she says.
Ms Chirikure highlighted that while the compliance drive is widely seen as necessary, its effects on the rental market are more complicated, especially given the limited housing supply.
“To understand what happens next, we need to consider how housing supply and demand work. Shelter is a basic need, and supply can’t change overnight. Zimbabwe already doesn’t have enough housing, and that reality shapes everything.”
Ms Chirikure said when costs are added in such a market, they usually get passed on to tenants.
“In a market where rentals are hard to find, taxing gross rental income affects what tenants end up paying. This is a structural reality, not a choice,” she says.
Ms Chikure added that taxing gross income rather than profit after expenses poses a real challenge for landlords.
Using a typical example, Ms Chirikure showed how operating costs can quickly eat into returns.
“Suppose rent is US$1 000 and operating costs are about US$900, leaving US$100. A 15 percent tax on the full US$1 000 comes to US$150 – meaning the landlord loses money before making any profit. So the gross rent has to rise to make the numbers work,” she explains.
This pattern, Ms Chirikure notes, is seen in other countries too, where tax or regulatory changes affect rental supply and pricing.
“Other countries have seen similar things happen. In some places, tighter rules have pushed landlords out of the market, reducing supply. In others, rents have had to climb sharply to keep properties viable,” she says.
Ultimately, Ms Chirikure said the goal is to expand the tax base while keeping a working rental market, but finding that balance will be crucial.
“The real challenge is bringing more people into the tax system without shrinking the supply of rental properties. We need to widen the tax base while protecting the rental market that tenants, workers and businesses depend on,” she said.
The new measures, which took effect on January 1, 2026, require landlords leasing to commercial tenants to register with ZIMRA and submit quarterly returns detailing rental income and tenant information.
The initiative was introduced by Finance, Economic Development and Investment Promotion Minister Professor Mthuli Ncube as part of the 2026 National Budget.
With a compliance deadline looming under ZIMRA’s voluntary disclosure framework, property owners are being urged to regularise their tax affairs or face enforcement action.-herald
