Madagascar Rental Income Guide 2026

Overview — Rental Income Tax in Madagascar

Rental income from letting or leasing of immovable property (land and buildings) is chargeable to income tax in Madagascar as part of the landlord's total taxable income. Unlike some jurisdictions that apply a flat withholding tax on gross rent, Madagascar taxes net rental income (after allowable deductions) at the owner's progressive IRPP rate. For individuals, this means rental income is added to salary, business profits, and other income before applying the 0–36% progressive brackets. For companies, rental income is included in chargeable profits and taxed at the IBS rate. The tax year follows the calendar year.

Residential Rental Income — IRPP Treatment

For individual landlords letting residential property, the net rental income (gross rent minus allowable expenses) is added to the individual's total income and taxed under the progressive IRPP schedule. The professional deduction of 20% does not apply to rental income — only actual expenses are deductible. Landlords must declare rental income in their annual tax return filed by 30 April. The tax is calculated on the net rental profit after deducting allowable expenses. There is no specific minimum tax or threshold for rental income — even a single property let for modest rent must be declared.

Allowable Deductions

Landlords may deduct the following expenses from gross rental income to arrive at taxable net rental income:

• Repairs & maintenance — painting, plumbing, electrical repairs (not capital improvements)
• Property management fees — paid to licensed agents or management companies
• Insurance premiums — building, fire, and liability insurance
• Mortgage interest — interest on loans used to acquire or improve the property
• Land tax (taxe foncière) — annual property tax paid to DGI
• Depreciation — building depreciation at 5% per annum straight-line
• Agency & legal fees — for tenant acquisition and lease agreements
• Utilities — if paid by the landlord and not reimbursed by the tenant

Expenditure that improves the property (extensions, major renovations) is capital in nature and not immediately deductible — it may be depreciated over the useful life. Landlords should maintain detailed records of all income and expenses.

Furnished Lettings & Short-Term Rentals

Furnished property lettings and short-term rentals (holiday lets, Airbnb) may be treated differently. Where the landlord provides furniture, utilities, cleaning, and other services, the activity may be classified as a commercial business activity rather than pure property letting. In such cases, the income is treated as business income (bénéfices industriels et commerciaux, BIC) rather than rental income. The landlord can deduct all business expenses and may also be liable for VAT if turnover exceeds MGA 20,000,000 for goods or MGA 10,000,000 for services. The progressive IRPP rates still apply for individuals, but the taxpayer files under the BIC regime rather than the rental income category.

Corporate Landlords

Companies that derive rental income from property letting are taxed under the standard IBS rules. The net rental profit (gross rent minus expenses and depreciation) is included in the company's total chargeable profits and taxed at the applicable IBS rate (20% standard, 15% agriculture/export, 10% new companies). Companies may claim capital allowances on the building cost (depreciation at 5% per annum). Rental losses may be offset against other income of the company, subject to general loss relief rules (carry forward up to 5 years).

FAQs

Do I need to register as a landlord with DGI?

All landlords receiving rental income must declare it in their annual tax return. There is no separate landlord registration requirement, but you must have a Tax Identification Number (NIF) and include rental income in your annual declaration.

What if my tenant pays for utilities directly?

If the tenant pays utilities directly to the service provider (JIRAMA), these payments are not included in your rental income. If you pay utilities and the tenant reimburses you, the reimbursement is gross rental income and you may deduct the utility cost.

Is rental income from agricultural land taxed differently?

Rental income from agricultural land is generally treated as agricultural income and may benefit from the reduced 15% IBS rate if the lessee is a company. For individual landlords, it is included in IRPP assessment like other rental income.

Disclaimer

This guide provides general information about Malagasy rental income tax for the 2026 tax year. Tax laws and rates may change. Always consult with a qualified Malagasy tax advisor or the Direction Générale des Impôts for advice specific to your situation. InvestmentKit does not provide tax advice.