The deadline of June 22, 2024, for applying for voluntary disclosure incentives is rapidly approaching. This one-time opportunity was established for individuals, companies, and non-governmental organisations to voluntarily disclose their undeclared taxes for tax periods before 2023, and pay the principal tax without penalties and interest. Since the three-month window began on March 22, 2024, over 200 taxpayers have disclosed their undeclared and unpaid taxes, including Income Tax, Value Added Tax, Pay As You Earn, Withholding Tax, Excise Tax, Property Tax, and Trading License. Ronald Niwenshuti, Assistant Commissioner for Tax Audit at Rwanda Revenue Authority (RRA), commended those who have come forward, emphasising that this opportunity was created to help taxpayers comply with the law, as penalties can significantly impact business revenues and operations. This opportunity is limited in time and is rare. Since RRA was established, such an opportunity had never existed. For the government to establish a law that allows people with undeclared taxes to come forward and disclose them, is not something that happens often, he said. That's why we encourage taxpayers to seize this opportunity. No one goes into business to pay penalties; they aim to grow and pay taxes. Missing this opportunity is not a good choice, as we will conduct audits as usual. Penalties will be applied to anyone who does not properly declare their earnings or voluntarily disclose, he added. Niwenshuti highlighted the strong interest in these incentives and encouraged others to conduct financial health checks and disclose voluntarily before the June 22 deadline. After this period, incentives will no longer be available, and RRA will use available information to recover all taxes due. It can leverage data from those who have disclosed, conduct data matching across its systems, and utilise information exchange capabilities with other countries to identify non-compliant taxpayers. The Government of Rwanda has also signed agreements with several countries to eliminate double taxation, which will be useful in the process. According to Article 82 of Law n° 020/2023 of 31/03/2023 on tax procedures, an administrative fine of 20 per cent of due tax is imposed on a taxpayer who fails to declare and pay tax within the time limit provided by law, if the time limit for payment extends for a period not exceeding 30 days. The fine becomes 40 per cent of due tax if the taxpayer pays within a period ranging from the 31st day to the 60th day from the final date of payment; and 60 per cent of due tax if the taxpayer exceeds the time limit for payment by more than 60 days. How to apply for voluntary disclosure Taxpayers can access the voluntary disclosure opportunity through the RRA website (https://etax.rra.gov.rw/landingPage). Applications must clearly indicate the relevant tax type and period, the tax amount, and include supporting documents. All information must be complete and accurate. Ministerial Order nº 001/24/03/TC of 08/03/2024 stipulates that a taxpayer who is granted the voluntary disclosure incentives must pay the total amount of principal tax disclosed within 30 days from the date of approval. However, the tax administration may allow the taxpayer to pay in instalments if they present valid reasons. The voluntary disclosure incentives are available to anyone who has conducted a taxable activity, whether registered or not, but has undeclared taxes related to any tax period before 2023. The taxpayer must voluntarily declare and pay tax before being notified of an imminent audit. This also applies to taxpayers who have submitted their declarations but need to revise submitted tax returns to increase the tax amount. RRA emphasises that these incentives cover all domestic taxes, except customs taxes and duties. Taxpayers who have been audited can still disclose additional tax liabilities beyond what the audit discovered. A taxpayer also retains the right to disclose at any time following the prescription of the audit powers.
