This tax declaration specifically pertains to business activities conducted between January 1, 2024, and December 31, 2024. Following the end of this tax period, taxpayers are granted an additional three months to complete their accounting and submit their income tax returns to the RRA.
With the deadline fast approaching, the RRA reminds taxpayers that timely compliance is essential to avoid unnecessary penalties and ensure smooth processing of their returns.
Jean Paulin Uwitonze, Assistant Commissioner in charge of Taxpayer Services and Communication, explains that those concerned with this tax are individuals or businesses that generate income and have a Taxpayer Identification Number (TIN).
Thus, they must declare whether they engaged in business activities or not or if they made profit or not.
"We have individuals who obtained their TINs in 2024. When you acquire a TIN, you are required to declare, for the first time, between January and March of the following year," he clarified. "You may have operated for a month, two months, or the entire year. The important thing is that if you have engaged in profit-generating activities, you are required to pay income tax, and that will be determined after declaration."
'We are saying that any taxpayer with a TIN, whether they have operated or not, should declare their status and whether they made a profit or not, fulfilling their obligation to declare is required by law.'
Apart from taxpayers registered under the real regime, who manage their accountancy and pay the corporate income tax at 28 percent rate, small enterprises composed of those whose turnover is between Frw 12 million and Frw 20 million, must pay a lump sum tax of 3% on annual turnover. Micro-enterprises pay a flat tax based on their annual turnover.
Taxpayers under the lump sum or flat tax regimes can file their returns by dialing *800#, allowing them to declare easily using their mobile phones. Corporate income taxpayers, however, file their declarations through the e-tax system.
Assistance for Taxpayers facing difficulties
To support those encountering difficulties during the declaration process, a help desk was set up and will remain open to assist taxpayers, who may encounter challenges while filing their 2024 income tax, with just few days left until the March 31, deadline.
Kimihurura support desk assists those in the City of Kigali while those in provinces can access the same services from their respective district tax centres.
"Currently, very few have declared, which is an issue. We expect a rush and high traffic at the last minute, yet the system has been open for three months," Uwitonze explained.
'That's why we encourage people to declare earlyâ€"it doesn't mean you have to pay right away. Declare early, know your tax amount, and you can pay later on the 28th, 29th, or 30th of the month; but make sure you have declared to avoid becoming one of those in last minute long queues in need of urgent help.'
With the changes made this year, taxpayers can now generate a declaration document (Doc ID) in the system. To do this, go to E-Tax, select "Online Requests," and find the option to request the declaration document. Choose the type of tax and the period, and then continue.
Taxpayers are urged to act promptly to declare their taxes and avoid the last-minute rush, which may lead to penalties.
Penalties for non filing
The tax procedure law states that a taxpayer who fails to declare and pay tax within the legal time limit must pay the tax due and is subject to an administrative fine. It provides for both general fixed administrative fines and non-fixed administrative fines for non-filers.
For fixed administrative fines, a taxpayer provides different rates:
- Frw 50,000: If the annual turnover is below Frw 20 million:
- Frw 300,000: For a public institution, a non-profit organization or a taxpayer whose annual turnover exceeds Frw 20 million
- Frw 500,000: If they fall under the category of large taxpayers.
In addition, there are non-fixed administrative fines, and the law provides different rates:
- A penalty of 20% of the due tax applies if the delay does not exceed 30 days.
- A penalty of 40% applies if the taxpayer pays within 31 to 60 days after the deadline.
- A penalty of 60% applies if the delay exceeds 60 days.
Late payment interests
If a taxpayer declares the tax due within the legal time limit but fails to pay it on time, the following fines apply:
- 5% of the due tax if the delay does not exceed 30 days.
- 10% of the due tax if the payment is made between 31 and 60 days after the deadline.
- 30% of the due tax if the delay exceeds 60 days.
A taxpayer who fails to pay tax within the period set by law is also subject to late payment interest on the principal tax amount:
- 0.5% if the delay does not exceed 6 months.
- 1% if the delay is between 6 and 12 months.
- 1.5% if the delay exceeds 12 months.
Late payment interest is non-compounding and is calculated on a monthly basis from the first day after the due date until the payment date. Each month that begins is counted as a full month. The total late payment interest cannot exceed 100% of the due tax.
IGIHE
Source : https://en.igihe.com/news/article/rra-urges-taxpayers-to-declare-2024-income-tax-as-deadline-looms
