The rate
The standard rate in Rwanda is 18%. Some goods and services carry reduced or zero rates and others are exempt. The difference matters: zero-rated sales still let you reclaim the tax on your purchases, exempt sales do not.
Who must register
FRW 20,000,000 of turnover in any twelve-month period, or FRW 5,000,000 in the preceding three months. Taxable, exempt and zero-rated sales all count towards it. You have seven days from the end of that year, or of those three months, to register. Any taxpayer below the threshold may register voluntarily. Trading above it without registering costs an administrative fine of 50% of the VAT due for the whole period you traded unregistered, and issuing a VAT invoice while not registered costs 100% of the VAT plus the tax shown on the invoice.
Filing and paying
Registered and filed with Rwanda Revenue Authority (RRA).
Filed and paid in e-Tax by the 15th of the month after the period. The dividing line is FRW 200,000,000 of annual turnover, and the two authorities on it read in opposite directions: article 28 of Law nº 049/2023 puts turnover of FRW 200 million or less on quarterly returns and lets them opt up to monthly, while RRA's Tax Handbook describes monthly as the default with under FRW 200 million able to request quarterly. Either way, below FRW 200 million you can be on calendar quarters — 15 April, 15 July, 15 October, 15 January — and above it you file monthly. File for every period in your category whether or not you sold anything, whether you owe tax or are claiming a refund, and even if the figure comes out at zero.
Penalties for getting it wrong
Declaring and paying late: 20% of the tax due up to 30 days late, 40% from day 31 to day 60, 60% beyond 60 days. Declaring on time but paying late is cheaper — 5%, 10% and 30% across the same steps. Interest runs on top at 0.5% a month for a delay up to six months, 1% from six to twelve months, 1.5% beyond twelve. A fixed fine comes on top of that: FRW 50,000 if annual turnover is under FRW 20 million, FRW 300,000 above it or for a public institution or non-profit, FRW 500,000 if RRA has notified you that you are a large taxpayer. The fixed fine doubles on a second late filing of the same tax type and triples on the third within five years. Coming forward voluntarily, before RRA raises it, waives the penalties and the interest.