In a bid to ease the payment of tax and promote small-and-medium enterprises (SMEs), the government reviewed policy, allowing Pay As You Earn (PAYE)-registered SMEs whose annual turnover is Rwf200m or below to file and pay their PAYE returns on a quarterly basis.

This was in addition to the introduction of quarterly payment of Value Added Tax (VAT) in 2010 for the same category of taxpayers.

Previously, all PAYE-registered entities with a turnover less than Rwf200m were required to file PAYE returns on a monthly basis.  

The initiative is credited for addressing taxpayers’ needs, as it saves time and increases the firms’ operating capital since the money the firms would pay monthly as Pay As You Earn returns is now used for commercial transactions longer than before - three months - before they remit their Rwanda Revenue Authority (RRA) tax obigations.

In addition, taxpayers under the PAYE quarterly payment scheme do not incur transport costs since they file and pay their PAYE returns using the online filing and payment system.

However, voluntary declaration and payment on a monthly basis by any taxpayer is still admissible for PAYE-registered taxpayers in this category.

It is important to note that the facility does not benefit all companies, including not-for-profit organisations.

The government is committed to continue easing the ‘tax pressure’ on taxpayers by introducing new facilities that help them reduce the cost of doing business, thus promoting national development.

The writer is the head of media and customer relations at Rwanda Revenue Authority