The Rwanda Revenue Authority (RRA) has announced that a new law establishing taxes on income no. 027/2022 of 20/10/2022 published in official gazette no special of 28/10/2022.
Considering that tax administration system has to be adapted to the changes provided for by the law regarding the new brackets on which tax computation will be based, RRA announced to all taxpayers that the provisions of this new law in article 56 related to the withholding tax on employment income will be applied from the month of November 2022, which tax period will be declared and paid not later than 15th December 2022.
Article 56 (Withholding tax on employment income) of the new law provides the rates that will be applied to employment income as per below:
Table 1: First year following the date of commencement of this law
|
Monthly taxable income in Rwandan francs (FRW) |
Tax Rate |
|
|
From |
To |
|
|
- |
60 000 |
0% |
|
60 001 |
100 000 |
20% |
|
100 001 |
More |
30% |
Table 2: From the second year after the commencement of this law
|
Monthly taxable income in Rwandan francs (FRW) |
Tax Rate |
|
|
From |
To |
|
|
- |
60 000 |
0% |
|
60 001 |
100 000 |
10% |
|
100 001 |
200 000 |
20% |
|
200 001 |
More |
30% |
Income from a casual labourer is subject to tax on the special rate of fifteen percent (15%).
However, in computing casual labourer’s tax, an income not exceeding sixty
thousand Rwandan francs (60,000 FRW) per month is rated at zero percent (0%).
Article 57 of the new law states that an employer who is not the first employer shall withhold tax on employment income at the rate of thirty percent (30%).
The changes will be implemented on the system soon!