The Rwanda Revenue Authority (RRA) has urged taxpayers to file and pay their Income Tax Quarterly Prepayment (IQP) for the second quarter of 2023 before the September 30 deadline.

The concerned taxpayers include all individuals and businesses that generate income, who are subject to either Real Regime Income Tax for those who do their accounting, flat tax regime for those who pay a fixed amount or lamp sum regime. 

The second IQP calculation is based on the income earned over the three-month period of April, May, and June 2023. 

This call for early declaration and payment comes after RRA has often noted that many taxpayers wait until the last minute to complete their tax responsibilities and such practice frequently results in needless errors, which may be avoided if taxpayers sought early assistance from RRA staff.

Umulisa Jeanne, who runs an event planning and decoration business in Kigali, commended the quarterly prepayment system for alleviating the tax burden for businesses. 

“It's convenient because it resembles paying taxes in installments. This is significantly more reasonable than having to pay a large sum at the end of the year, which can be really difficult for businesses," she explained.

Umulisa urged all business owners to follow tax regulations by declaring and paying their outstanding taxes on time, emphasizing the need of avoiding last-minute rushes. 

"If we were required to pay everything at the end of the year, it could jeopardize our finances. RRA has lightened the burden by introducing quarterly prepayments, and this allows us to reinvest in our businesses" said Ugiraneza Anastasie, a mini-supermarket owner in Gikondo, City of Kigali.

She urged taxpayers not to procrastinate, as last-minute declarations can lead to various challenges, including the system congestion and penalties for non-compliance. 

"Paying taxes is our civic duty, and we should adhere to the laws. This initiative was introduced because RRA was aware of the challenges taxpayers faced," she emphasized. 

The concerned taxpayers are those who declared and paid income tax for the year 2022 in March 2023, excluding those who made nil-filing declaration declarations. 

This group also encompasses taxpayers who failed to declare their income tax for the first quarter in June 2023, and it is imperative for them to declare this first-quarter income before the second. This is because the RRA systems do not accept empty spaces in quarterly declarations. 

Uwitonze Jean Paulin, the Assistant Commissioner for Taxpayer Services and Communications Division, urged the taxpayers to file and pay their quarterly income tax before the looming September 30 deadline. 

"It's not mandatory to declare and pay directly. While some individuals may find it convenient, you have the option to handle these tasks separately. Declare your taxes today, and pay them before the September 30 deadline to sidestep unnecessary last-minute pressure," he emphasized. 

Uwitonze also noted that some taxpayers might encounter issues related to tax account reconciliation and may require support from RRA staff. However, delaying until the last minute could lead to avoidable challenges including potential IT issues. 

"It's crucial to steer clear of last-minute pressures and the accompanying consequences," he added."

Tax declarations can be made using the E-Tax system (https://etax.rra.gov.rw/) or by dialing *800# and following the provided instructions. Payments can be made using Mobile Money, Mobicash, e-banking, or by visiting the nearest bank branch.

A taxpayer who fails to submit a tax declaration is subject to an administrative fine of Frw 50,000, for a natural person not engaged in any commercial activity or a taxpayer whose annual turnover is more than Frw 2 million but not exceeding Frw 20 million.

Furthermore, a taxpayer who fails to pay tax within the time frame specified by the law is charged late payment interest on the amount of principal tax.

The rate of interest is 0.5 percent if the taxpayer has recorded a delay not exceeding six months; 1% percent if the taxpayer has recorded a delay not more than 12 months; and 1.5%, if the taxpayer has recorded a delay of more than 12 months.