Penalties and Interest

Taxpayers are obliged to declare their tax returns originating from their motor vehicles/ cycles incomes on time as it is stipulated in the law. It is advisable to honor this obligation in order to avoid penalties and interests.

Interest

A taxpayer who fails to pay tax within the stipulated time frame is required to pay interest on payable principal tax. Interests are calculated on a monthly basis at the inter-bank offered rate of the National Bank of Rwanda plus 2 (two) percentage points. For example if the inter-bank rate is 9%, interest imposed is at 11% annually.

Penalties

 With regard to Income tax, a taxpayer is subject to penalty and fine if she/he has failed to:

a) file a tax declaration on time; b) file a withholding declaration on time; c) withhold tax; d) reply to an information request of the Tax Administration; e) cooperate with a tax audit; f) communicate the capacity or appointment as described by Article 7 §2 of the Law on Tax Procedures; g) register as described by Article 10 of the Law on Tax Procedures; or h) Comply with Articles 12, or 13, of the Law on Tax Procedure