Mozambique Rental Income Guide 2026

Overview — Rental Income Tax in Mozambique

Rental income from letting of immovable property (land and buildings) is chargeable to income tax in Mozambique. The tax treatment depends on whether the landlord is an individual (taxed under IRPS) or a company (taxed under IRPC). For individuals, rental income is added to other income and taxed at progressive rates up to 32%. Landlords must register with ATM and declare rental income in their annual tax return. The tenant may be required to withhold tax at source at 20% on rent payments (retenção na fonte) as an advance payment of the landlord's final tax liability.

Simplified Regime — 50% Deduction

Individual landlords may opt for a simplified regime where 50% of gross rental income is considered taxable (effectively a 50% automatic deduction). Under this regime, no itemised expense records are required. The remaining 50% of gross rent is added to the landlord's other income and taxed at progressive IRPS rates up to 32%. This is often the most convenient option for landlords with modest rental portfolios. The simplified regime is available to individuals with annual rental income below MZN 1,000,000.

General Regime — Deductions

Landlords may elect to be taxed under the general regime, where deductible expenses are itemised against gross rental income. Allowable deductions include:

• Repairs & maintenance — not capital improvements
• Property management fees — paid to licensed agents
• Insurance premiums — building and fire insurance
• Mortgage interest — interest on loans used to acquire or improve the property
• Municipal property tax (AUT) — paid to the municipality
• Depreciation — of the building at applicable rates

To claim itemised deductions, the landlord must maintain proper books and records and file an annual return with supporting documentation.

Withholding Tax on Rent

Tenants who are registered businesses must withhold 20% of the gross rent paid to the landlord and remit it to ATM within 20 days of the payment. This withholding tax is an advance payment of the landlord's final tax liability. The landlord claims credit for the withheld amount when filing the annual tax return. Individual tenants (non-business) are not required to withhold tax. The landlord is ultimately responsible for ensuring the rental income is declared and taxed correctly.

FAQs

Is short-term letting (Airbnb) taxable?

Yes, income from short-term letting and holiday rentals is taxable as rental income. The same rules apply as for long-term letting. The simplified 50% deduction regime is available for qualifying landlords.

Do I pay tax if the property is vacant?

No, rental income is only taxable when the property is actually let. There is no deemed rental income for vacant or owner-occupied properties. However, municipal property tax (AUT) continues to apply regardless of occupancy.

Can I deduct property renovations?

Renovations that are capital improvements (extending the property, structural changes) are not immediately deductible but may be depreciated over time. Repairs and maintenance are fully deductible in the year incurred.

Disclaimer

This guide provides general information about Mozambican rental income tax for the 2026 tax year. Tax laws and rates may change. Always consult with a qualified Mozambican tax advisor or the Autoridade Tributária de Moçambique for advice specific to your situation. InvestmentKit does not provide tax advice.