Rwanda Revenue Authority (RRA) has urged business owners and owners of immovable property to comply with the deadline for declaring and payment of trading license and rental income tax respectively. This rallying call was made by the Deputy Commissioner for Regional and Decentralized Taxes, Ernest Karasira yesterday. Karasira called on all business owners and immovable property owners to respect the January 31st, 2021 deadline and subsequently avoid being penalized for late declaration and non-payment. He called on the taxpayer to use the online system and to do this early to avoid the last-minute rush. “We encourage all concerned taxpayers to use our online/e-tax system early enough as they declare and pay for trading license and rental income tax. For trading license, the system has even made it easier to declare and pay through the mobile phone by simply dialing *800# and following the prompts,” noted Karasira. Karasira also noted that the pressure on the online system might increase in the coming days since RRA is currently implementing guidelines issued by the Government of Rwanda in the fight against the Covid-19 pandemic among them including the lockdown in the City of Kigali. He therefore urged taxpayers to make their declaration and payment in time instead of waiting for the last minute when the system may be overwhelmed. The Tax Administration has also shared contact details of staff members who will be helping taxpayers across the country during this period of isolation should the need arise, officials said. These will be available to assist taxpayers in the shortest time possible via email or via telephone. This move is expected to limit physical interactions between taxpayers and the revenue staff and thus curb the spread of the Covid-19 virus, which has seen an upsurge in number of infections in recent times. Rental income tax is charged on all individuals or entities that earn revenues by renting out fixed assets located in Rwanda, including land, buildings and developments. It is charged at between 0% and 30% of net income (income that accrues after deducting 50% of the gross income to carter for interest payment and maintenance cost of the building, land or any development within the tax period). Trading license, commonly known as Patente, is paid by taxpayers who own VAT registered businesses as well as other profit-making activities. It is also important to note that new small and medium enterprises are exempted from paying for trading license during the first two (2) years following their establishment. Rental income tax, property tax and trading license are a key contributor to the overall local government revenue mobilization raking in over 62 billion in the previous fiscal year 2019/2020.
