The Rwanda Revenue Authority has published four Ministerial Orders on residence and effective management, certified financial statements, simplified accounting for small businesses, and requirements for carrying forward losses for more than five years. The Orders were all published in the Official Gazette on 6 May 2019 and are effective from that date, with any prior provisions contrary to the Orders repealed.
This Ministerial Order provides that for a natural person, a taxpayer’s home, his or her house, an apartment, a hotel or any other residential quarters in Rwanda where the taxpayer usually stays is considered as his or her permanent residence.
For a taxpayer, other than a natural person, it is deemed to have its place of effective management (and its residence) in Rwanda in one of the following circumstances:
This Ministerial Order provides that any taxpayer with an annual turnover of at least RWF 600 million is obliged to have their financial statements certified by a qualified professional approved by the tax administration. Certain exemptions apply as provided for in the Order.
This Ministerial Order provides that a taxpayer who carries out a small business and opts for paying taxes on actual profit is subject to simplified accounting and is required to keep the following basic records:
The basic records required are included in an annex to the Order.
This Ministerial Order provides that a taxpayer who applies for carrying forward losses for more than five tax periods must:
The Commissioner General is to respond to request no later than the end of the year of the tax period during which the application was filed. In case that period expires without any response, the loss is considered to have been authorized to be carried forward for one year only. The period for carrying forward the loss cannot be extended for more than five years (i.e., ten years total). Further, the extended carry forward may be withdrawn if the taxpayer does not declare or pay taxes on time, is found guilty of tax evasion, or distributes profits.
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