1. Tax Administration

Permanent URI for this community

http://10.150.1.119/handle/123456789/2601

Browse

Browsing 1. Tax Administration by Author "Agumba, Evans"

Now showing 1 - 1 of 1
  • Thumbnail Image
    Item
    Factors influencing monthly rental income tax compliance in Kenya
    (KESRA/JKUAT - Unpublished research project, 2018-10) Agumba, Evans
    Tax compliance has been a crucial subject to researchers in many countries around the globe. In most third world countries house rental taxation has been classified as economic. In Kenya, statistics indicate that less than half of property owners and developers comply with rental income tax requirements. The general goal of this study was to determine the factors influencing monthly rental income tax compliance by the property owners in Kisumu, Kondele estate. Some of the specific variables of considerations included; determining the extent to which tax rates explains tax compliance; assessing the availability of tax information as a factor influencing tax compliance; determining the extent to which costs incurred by rental property owners in being tax compliant influence their level of tax compliance; and determining how rental property owner’s attitude about tax influence tax compliance. The discussions of the findings of the study were based on the Fiscal exchange and the Allingham-Sandmo (AS) Theories. A descriptive survey design was adopted for this study. The study targeted approximately 200 rental property owners in Kondele estate, in Kisumu town. The study applied a systematic random sampling technique whereby the researcher selected the nth respondents from the targeted population to be included in the sample. This study integrated both the primary and the secondary sources of data. Primary data was obtained through a questionnaire, whereas the secondary data was obtained from the available written/documented materials. In evaluation of relation between variables, that is dependent variables and independent variables, a multiple regression model was adopted. The study applied both qualitative and quantitative techniques of data analysis, and the information obtained were presented in form of tables, charts and graphs. To test the statistical significance, the F and t test was used. The F-Statistic was applied to determine significance of regression model, that is, to what extent the variation in independent variable explains the changes in dependent variable. Analysis of Variance (ANOVA) was used to establish total variations within and between variables to determine relation between variables. T- test was employed to test statistical significance of regression coefficients at 95% confidence level. The study findings established that tax rate and tax knowledge significantly and positively influences residential rental income tax compliance by property owners. Based on this finding the study recommends that tax rate applicable on residential rental income influences tax compliance by property owners and an increase in tax knowledge and education enhances compliance by property owners. The study found that income levels and cost incurred in being tax compliant, tax legislations (fines and penalties) negatively influence tax compliance by property owners. The study thus concludes that high levels of income encourage tax compliance but low-income levels encourage non-compliance of residential rental income tax by property owners and punitive fines and penalties encourage property owners to comply tax obligations. Based on the finding, this study recommends that KRA should develop training programs to create awareness on residential rental income tax compliance by property owners. It is also recommends that additional studies on the other factors that influence compliance of residential rental income tax by property owners, should be conducted
Copyright Statement : Items in KESRA Institutional Repository are protected by copyright laws, which make its deliberate infringements a criminal offence. Permissible copying limits shall be 10% or less of a book made for academic purposes. Any violation of copyright laws will be the responsibility of the patron, and the photocopying agent in accordance with the Laws of Kenya; the copyright act, chapter 130, 2014. Unless otherwise indicated. Please acknowledge publications according to acceptable standards and norms.