Tenant not paying rent

My tenant has not paid my rent since 2021 despite serving him with a notice to vacate the premises for failure to pay rent. Besides, my tenancy agreement with him expired in December 2019 and I was unable to renew it because I could not travel during the pandemic. The tenant has also not been deducting withholding tax from the rent paid to me for the year 2020 and 2021. Please guide me what I should do?
SM, Dar

After reading your question, we have extracted two main issues. Firstly, you want to know the implication of not renewing the tenancy agreement in writing for the years 2020 and 2021. Secondly, you want us to advise you on the procedure and steps to follow in recovering the unpaid rent and getting vacant possession of your leased premises.

We start with the first issue, the lease term with your tenant was for one year. Unfortunately, you haven’t disclosed to us on whether or not the expired tenancy agreement contained an “automatic renewal clause” (ARC). The ARC is an option that gives one side the right to extend the lease, usually the tenant. If the tenant does not exercise the option, the lease expires with its original term. With an ARC, either the tenant or the landlord must give notice to prevent the lease from renewing. The ARC makes the Agreement perpetual until either party gives a notice of terminating it. In your case, if the 2019 Agreement contained an ARC, then the tenancy for 2020 and 2021 were automatically renewed under the same terms and conditions.

On the other hand, even if the Agreement of 2019 does not contain the ARC, the act of allowing the tenant to continue staying in the premises for two years after expiry of the original agreement is, by implication, regarded as an automatic renewal of the tenancy agreement in terms of section 79(2) of the Land Act.

Since there is an implied renewed contract, section 89(2)(b)(i) of the Land Act gives you a right of serving the tenant with a notice of intention to terminate the tenancy agreement where any rent is unpaid for one month after the due date for payment whether or not the demand for payment has been made by you or your agent in writing. The act of your tenant not paying the accrued rent even after serving him with a demand letter amounts to a fundamental breach of the agreement and entitles you the right to institute a suit for recovery of rent and for eviction order against that tenant.

As regards the failure by your tenant to withhold tax on the rental income you received for years 2020 and 2021, the Income Tax Act imposes a responsibility on both of you. It states that where a withholding agent fails to withhold income tax from a payment, the withholdee and a withholding agent shall jointly and severally be liable for the payment of the tax to the Commissioner. For that matter, we advise you to remit the amount which your tenant ought to have withheld to TRA and if you do so on your own accord the TRA may waive any penalty and interest. We recommend you do so immediately and comply with our tax laws.