Corporate income tax
From 28% down to 0%, by law
Rwanda taxes company profits at 28%. Registered investors in priority sectors pay 15%, qualifying holdings 3% and regional headquarters 0%. This page sets out every rate, who is taxed, what is deductible, how losses, advance payments and filing work, and what the 2025 and 2026 reforms changed. We work out which rate your company can reach and what it must do to keep it.
The law
One income tax law, amended twice
Rwanda's company tax rules sit in a single statute. Most of what a foreign-owned company needs is in it, with detail added by ministerial orders.
The core statute is Law N° 027/2022 of 20/10/2022 establishing taxes on income. It was gazetted and took effect on 28 October 2022, replacing the 2018 income tax law. Two amendments followed. Law N° 051/2023, gazetted on 14 September 2023, cut the standard corporate rate from 30% to 28%. Law N° 014/2025, most of which took effect on 29 May 2025, doubled capital gains tax to 10%, extended it to debt instruments and options, and introduced a digital services tax that still awaits its implementing order.
Below the law sit ministerial orders. The most recent of note is Ministerial Order N° 003/26/10/TC of 29 April 2026, which rewrote the transfer pricing rules, set a framework for advance pricing agreements and consolidated the rules for carrying losses forward beyond five years. The Rwanda Revenue Authority (RRA) administers the tax. In Kinyarwanda, tax is umusoro (tax), and you will see the word on every RRA form and notice.
There are no local or regional income taxes. A company in Kigali, in the Kigali Special Economic Zone or in a district far from the capital pays the same national corporate tax.
Sources: EY Global Tax Alert, Rwanda gazettes new income tax law (December 2022); Diacron Group on Law N° 051/2023; EY Global Tax Alert, 16 June 2025, on Law N° 014/2025; PwC Rwanda tax alert on Ministerial Order N° 003/26/10/TC (2026); PwC Worldwide Tax Summaries, Rwanda (reviewed September 2026).
Rates
Every corporate rate in one table
| Who | Rate | Condition |
|---|---|---|
| Standard | 28% | All companies and branches without a special regime. |
| Priority sectors | 15% | Registered investors in exports, energy, transport, ICT, financial services, low-cost housing, manufacturing, research and development, e-mobility, adventure and agri-tourism. |
| Holdings, SPVs, funds, foreign-sourced trading and IP income | 3% | Registered investors meeting substance conditions in Rwanda; 0% withholding tax on their distributions. |
| Regional headquarters | 0% | International companies with a regional office in Rwanda; RDB looks for USD 10 million invested. Philanthropic investors also qualify. |
| Tax holiday, 7 years | 0% | Registered investors with at least USD 50 million invested and at least 30% equity in manufacturing, tourism, health, exports, energy of 25 MW or more, or ICT. |
| Tax holiday, 5 years | 0% | Microfinance institutions and developers of innovation or industrial parks, under the investment code. |
| Newly listed companies | 20–25% | For five years, depending on the share of capital sold to the public (40% or 30%). |
| Small business | 3% of turnover | Turnover between RWF 12 million and RWF 20 million a year. |
| Micro-enterprise | Flat RWF 60,000–300,000 | Turnover below RWF 12 million a year. |
Sources: PwC Worldwide Tax Summaries, Rwanda, taxes on corporate income and tax incentives (reviewed September 2026); Diacron Group on Law N° 051/2023; RDB on regional office incentives.
The incentive rates are not elections on a tax return. They follow from investment registration with RDB and from facts the RRA can check: invested amounts, sector, office, staff and spending in Rwanda. Plan the structure first and register the investment before the first profitable year.
Calculator
What reaches you from a Rwandan profit
Corporate tax in Rwanda, then withholding tax on the dividend. Pick a regime and where the shareholder sits.
Dividend you receive
USD 0
Illustration only. The 15% and 3% rates need a registered investor and specific conditions; treaty rates need the treaty conditions to be met. Tax in the shareholder’s own country is not included. Rates: PwC Worldwide Tax Summaries, September 2026.
Quick check
Which rate applies to you
Four questions. The answer is the rate we would start from on a first call.
Who is taxed
Residence and permanent establishment
Rwanda taxes resident companies on their worldwide income and non-resident companies on income from Rwandan sources.
When a company is resident
A company incorporated in Rwanda is resident. A company incorporated abroad also becomes resident if its place of effective management is in Rwanda at any time in the tax period. The law deems effective management to be in Rwanda if day-to-day control and management happen there, if shareholder meetings are held there, if the books are prepared and kept there, or if the main shareholders or directors are Rwandan residents.
The last test deserves attention. A foreign holding whose directors move to Kigali, or whose board meets there, can become a Rwandan taxpayer without anyone deciding it.
When a foreign company has a permanent establishment
A permanent establishment is a fixed place of business through which a person's business is wholly or partly carried on, following the OECD model. Rwanda lists a place of management, a branch, a factory or workshop, a natural resource site, a construction, installation or assembly site, and a place providing services, including consulting, with personnel present for more than 90 days in a 12-month period.
Storage, purchasing, information gathering and other preparatory or auxiliary activities do not create one. A dependent agent who negotiates or concludes contracts for a foreign company can.
Consultants who send a team to Kigali for a project should count days from the first visit. Ninety days of service personnel within twelve months is enough to create a permanent establishment, and the clock does not reset with each trip.
Sources: PwC Worldwide Tax Summaries, Rwanda, corporate residence (reviewed 2026); EY Global Tax Alert on Law N° 027/2022, Art. 5 (December 2022).
The tax base
What you can deduct
Taxable profit starts from the accounts and is adjusted by tax rules. Expenses must be incurred wholly and exclusively for the business and backed by accepted invoices.
The general test has six parts. An expense is deductible if it is incurred wholly and exclusively for the business, is directly chargeable to income, is not capital in nature, is supported by accepted invoices or receipts, reduces the company's net assets and relates to the tax period in which it arises. Invoices from Rwandan suppliers should be certified invoices from the RRA electronic billing system. See VAT and withholding tax.
Depreciation
Accounting depreciation is added back. Tax depreciation applies instead, at rates set by law.
| Asset | Rate | Method |
|---|---|---|
| Buildings, heavy industrial equipment and machinery | 5% | Straight-line on cost |
| Purchased intangibles | 10% | Straight-line on cost |
| ICT systems with a life over 10 years | 10% | Straight-line |
| Computers, accessories, ICT systems under 10 years | 50% | Reducing balance |
| Other business assets | 25% | Reducing balance |
| Land, fine art, antiques, jewellery | 0% | Not depreciable |
| Registered investors, qualifying assets | 50% | Accelerated in the first year |
Source: PwC Worldwide Tax Summaries, Rwanda, deductions and tax incentives (reviewed 23 September 2026).
Interest and thin capitalisation
Interest on money borrowed to earn business income is deductible if paid under a legal obligation and reasonable. Interest on loans from related entities is not deductible to the extent total related borrowing exceeds four times paid-up equity. Reserves, provisions and retained earnings do not count as equity. Foreign exchange losses on related-party loans are not deductible for a thinly capitalised company, and unrealised exchange losses are not deductible at all. Banks and insurers are outside the 4:1 rule.
Fees to related parties abroad
Management fees, technical fees and royalties paid to related non-residents are deductible only up to 2% of turnover, and only if they are at arm's length and documented under the transfer pricing rules. A group that plans to recharge head-office costs to a Rwandan subsidiary should model this cap first.
Bad debts
A bad debt is deductible only if it was earlier included in income, has been written off in the books, all recovery steps have been taken and a court has declared the debtor insolvent. For debts of individuals under RWF 3 million, proof of reasonable recovery efforts over three years is required instead.
Donations
Donations to charities and non-profit organisations are deductible up to 1% of turnover. Donations to profit-making organisations are not.
Never deductible
Income tax itself, recoverable VAT, back taxes, and fines and penalties for statutory offences such as late payment. Goodwill amortisation is not deductible.
Sources: PwC Worldwide Tax Summaries, Rwanda, deductions and group taxation (reviewed September 2026); EY Global Tax Alert on Law N° 027/2022, Art. 25 (December 2022).
Losses
Five years forward, none back
A tax loss can be carried forward for five tax periods, oldest losses first. Losses cannot be carried back. The RRA may allow a longer carry-forward on application, and Ministerial Order N° 003/26/10/TC of 29 April 2026 now sets the conditions for that authorisation in one place.
One rule catches restructurings. If more than 25% of an unlisted company's share capital or voting rights changes hands in a tax period, directly or indirectly, by value or number, the losses of that period and earlier periods are forfeited (Law N° 027/2022, Art. 31). The rule does not apply to an internal reorganisation that keeps the same shareholders, provided they have held their shares for at least three years.
For a foreign founder this matters at two moments: when an investor comes into a loss-making start-up, and when a group moves the Rwandan company under a new holding. A change of more than 25% at any level above the company can trigger forfeiture.
Before you sell a stake or restructure the group, check the loss position of the Rwandan company. Losses lost through a change of ownership cannot be recovered later, and a buyer will price that in.
Sources: PwC Worldwide Tax Summaries, Rwanda, deductions (reviewed September 2026); EY Global Tax Alert on Law N° 027/2022, Art. 31; PKF East Africa, Rwanda revises its transfer pricing framework (2026).
The calendar
Advance payments, return and audit
Corporate tax is paid during the year, not only after it. The tax year runs from January to December unless the Minister of Finance approves another period.
- 30 June
First instalment
Advance corporate tax for the first half of the year, at month 6.
- 30 September
Second instalment
At month 9, with the quarterly declaration.
- 31 December
Third instalment
At month 12, the last advance of the year.
- 31 March
Annual return and balance
Within 3 months of year-end, with audited accounts and transfer pricing documentation.
How each instalment is calculated
There is no flat percentage. Each instalment equals the previous year's tax liability multiplied by the turnover of the current quarter divided by the previous year's annual turnover, minus withholding tax suffered in the period (Law N° 027/2022, Art. 33). A company whose sales grow pays more in advance; one whose sales fall pays less.
What goes with the return
The annual return is a self-assessment. It must include audited financial statements, transfer pricing documentation and any other documents the RRA asks for. Rwandan companies prepare accounts under IFRS for SMEs, or full IFRS if they are public-interest entities. We confirm whether your company also needs a statutory audit under company law. See accounting and payroll and the compliance calendar.
Audits and appeals
The RRA can audit five years back, extended to ten where concealment with intent to evade is established. Records must be kept for ten years. After fieldwork the RRA issues a draft assessment, and the taxpayer has 30 days to respond. A final assessment can be appealed to the Commissioner General within 30 days; the RRA has 30 days to reply, extendable by 30. An appeal to the High Court must follow within 30 days of that reply. Collection is suspended if the undisputed part has been paid, and an amicable settlement can run alongside the appeal.
Sources: PwC Worldwide Tax Summaries, Rwanda, tax administration (reviewed September 2026); EY Global Tax Alert on Law N° 027/2022, Art. 33; IFRS Foundation, jurisdiction profile Rwanda.
A worked example
One year of a Kigali services company
A consulting company owned by a UAE holding. Turnover RWF 2.9 billion, taxable profit RWF 725 million. Figures in USD use an illustrative rate of RWF 1,450 per US dollar; the BNR rate on the day applies in practice.
| Line | RWF | USD |
|---|---|---|
| Turnover | 2,900,000,000 | 2,000,000 |
| Cap on related-party management fees, 2% of turnover | 58,000,000 | 40,000 |
| Taxable profit | 725,000,000 | 500,000 |
| Corporate tax at 28% | 203,000,000 | 140,000 |
| Profit after tax, distributed | 522,000,000 | 360,000 |
| Dividend withholding, no treaty (15%) | 78,300,000 | 54,000 |
| Dividend withholding, UAE treaty (7.5%) | 39,150,000 | 27,000 |
| Net dividend to the UAE holding | 482,850,000 | 333,000 |
| Total Rwandan tax, UAE route | 242,150,000 | 167,000 (33.4%) |
| Total Rwandan tax, no treaty | 281,300,000 | 194,000 (38.8%) |
Advance payments the following year. Suppose the company's turnover in the second quarter of the next year is RWF 800 million. The 30 June instalment is RWF 203,000,000 × 800 / 2,900 = RWF 56,000,000, less any withholding tax suffered in the period.
If the company qualified for 15%. A registered investor in a priority sector, for example ICT services exported abroad, would pay RWF 108,750,000 (USD 75,000) of corporate tax on the same profit, saving RWF 94,250,000.
The management fee cap. If the UAE holding charged a management fee of RWF 100 million, only RWF 58 million would be deductible. The other RWF 42 million would be added back, costing RWF 11,760,000 in corporate tax, and the whole fee would also bear withholding tax at the treaty rate of 10%.
Calculation by Voixa Rwanda using rates from PwC Worldwide Tax Summaries, Rwanda (reviewed September 2026). The exchange rate is illustrative, not a market quote. Treaty conditions must be met.
Capital gains
Selling shares or assets
Capital gains tax rose from 5% to 10% under Law N° 014/2025, effective 29 May 2025. It now covers debt instruments and options as well as shares. It applies to direct and to indirect transfers of shares, whether the sale takes place in Rwanda or abroad (Law N° 027/2022, Arts. 35 and 37). A sale of a foreign holding that owns a Rwandan company can therefore be taxed in Rwanda.
Listed shares and other securities traded on a securities exchange operating in Rwanda are exempt (Art. 39), as are qualifying restructurings. Registered investors benefit from a capital gains exemption under the investment incentives.
Dividends inside Rwanda
Dividends between resident companies are excluded from taxable income and exempt from withholding tax (Art. 47). A Rwandan holding over a Rwandan operating company therefore receives dividends tax-free.
Digital services tax
Law N° 014/2025 introduced a 1.5% tax on the gross Rwandan revenue of non-resident digital service providers with a substantial presence. It applies once a ministerial order sets the criteria. Foreign digital services also come into VAT from the end of July 2026.
Sources: EY Global Tax Alert, 16 June 2025; EY Global Tax Alert on Law N° 027/2022 (December 2022); PwC Worldwide Tax Summaries, Rwanda, income determination and other taxes (reviewed September 2026).
Groups
Transfer pricing and the 2026 order
Rwanda has no group taxation. Every company files its own return, and losses cannot be shared within a group. There are no controlled foreign company rules.
Transactions between related parties must be at arm's length, under rules broadly consistent with the OECD guidelines. The Commissioner General can adjust profits that do not meet that standard. Documentation is filed with the annual return.
Ministerial Order N° 003/26/10/TC of 29 April 2026 replaced the 2020 order. It keeps the five OECD methods, extends the rules to transactions with unrelated parties in beneficial tax regimes and lowers the trigger for such a regime to a tax rate of 15%. It expands the expected content of the local file and master file and introduces advance pricing agreements, which the RRA may cancel on 30 days' notice for breach, changed facts, tax evasion or a treaty partner's request. A general anti-abuse rule (Art. 68) allows the RRA to disregard arrangements that lack commercial substance or have tax as their main purpose.
For groups that use a holding in the UAE, Mauritius or another low-tax place, the 15% trigger matters. Transactions with an entity taxed at 15% or less can fall under the transfer pricing rules even if the parties are not related.
Write the intra-group agreements before the first invoice, not at year-end. A management services agreement, a loan agreement with an arm's-length rate and a short benchmarking note make the transfer pricing file a formality rather than a project.
Sources: PwC Worldwide Tax Summaries, Rwanda, group taxation (reviewed September 2026); PwC Rwanda tax alert on Ministerial Order N° 003/26/10/TC (2026); PKF East Africa (2026); EY Global Tax Alert on Law N° 027/2022, Art. 68.
Incentives
How incentives interact with tax
Incentive rates come from the investment code, Law N° 006/2021. They depend on registration with RDB, and the RRA checks the conditions.
Registration comes first
An investment certificate from RDB is the gateway to 15%, 3% and 0%. There is no minimum capital; the fee is USD 500.
Read more → IshoramariSubstance keeps the 3%
Holdings and SPVs need net assets of USD 1 million, USD 15,000 annual spend in Rwanda, a physical office and at least 30% Rwandan professional staff.
Read more → IshoramariHolidays for scale
Seven years at 0% for USD 50 million invested with 30% equity in listed sectors; five years for microfinance and park developers.
Read more →Incentives stack in a defined way. A company on 15% still pays withholding tax on dividends to foreign shareholders, at 15% or the treaty rate. A holding on 3% pays 0% withholding on its distributions. Accelerated depreciation of 50% in the first year applies on top of the rate. Registered investors are exempt from capital gains tax.
Substance thresholds for the 3% regime differ by activity: foreign-sourced trading needs turnover of at least USD 10 million; IP income needs annual spending of at least USD 10,000 in Rwanda. Investors who reach USD 250,000 invested may recruit three foreign employees without a labour-market test, which helps build the local team the substance tests require.
Sources: PwC Worldwide Tax Summaries, Rwanda, tax incentives (reviewed September 2026); PwC tax alert on Law N° 006/2021 (2021); RDB, investment registration.
Geography
Where the incentives meet the map
Sources: PwC Worldwide Tax Summaries, Rwanda, other taxes (VAT exemption for special economic zones); kifc.rw.
Treaties
Rwanda's treaty partners
Treaties lower withholding tax on dividends, interest, royalties and fees leaving Rwanda. They do not change the 28% corporate rate.
| Partner | Dividends | Interest | Royalties |
|---|---|---|---|
| United Arab Emirates | 7.5% | 10% | 10% |
| Singapore | 7.5% | 10% | 10% |
| Morocco | 8% | 10% | 10% |
| Qatar | 5% / 10% | 10% | 10% |
| Luxembourg | 10% | 10% | 10% |
| Mauritius | 10% | 10% | 10% |
| Belgium | 0% / 15% | 10% | 10% |
| Türkiye | 10% | 10% | 10% |
| DR Congo | 10% | 10% | 10% |
| China, Korea, South Africa, Barbados, Jersey, Angola, Congo-Brazzaville | See the full table on VAT and withholding tax | ||
Source: PwC Worldwide Tax Summaries, Rwanda, withholding taxes (reviewed September 2026). Split rates depend on treaty conditions such as shareholding; we check them for your structure.
Recent changes
What changed in 2025 and 2026
- Capital gains tax doubled to 10%Law N° 014/2025, effective 29 May 2025. It now also covers debt instruments and options. Listed shares and qualifying restructurings stay exempt.
- New transfer pricing rulesMinisterial Order N° 003/26/10/TC of 29 April 2026 lowers the low-tax trigger to 15% and introduces advance pricing agreements.
- Loss carry-forward beyond five yearsThe same order consolidates the conditions for authorisation to carry losses forward longer.
- Digital services tax1.5% on non-resident digital providers, awaiting its implementing order.
- Simplified accounting for small businessesAn April 2026 ministerial order sets a simplified accounting method for small businesses that choose to pay tax on actual profits.
Sources: EY Global Tax Alert, 16 June 2025; Mondaq / ENS on the 2025 reforms; PwC Rwanda tax alert (2026); PKF East Africa (2026); RRA, Ministerial Order on simplified accounting method (April 2026).
The rate is set by law. Keeping it is a matter of facts the RRA can check.Voixa Rwanda
The law
What this page relies on
Words you will see
Tax terms, translated
FAQ
Questions founders ask
Does a new company pay 28% from day one?
Yes, unless it qualifies for an incentive or a small business regime. Incentive rates need an investment certificate from RDB and depend on sector and substance. We plan this before the first profitable year.
Is a foreign parent taxed in Rwanda on its own profits?
Only if it is resident in Rwanda through effective management, or has a permanent establishment there. Holding board meetings in Kigali or having Rwandan-resident main directors can make a foreign company resident.
How long can losses be carried forward?
Five tax periods, oldest first, with no carry-back. A longer period needs RRA authorisation under the 2026 ministerial order. A change of more than 25% in ownership of an unlisted company forfeits earlier losses.
Do I need audited accounts?
The annual corporate tax return is filed with audited financial statements. We confirm whether your company also needs a statutory audit under company law.
Can I charge management fees from my holding?
Yes, at arm's length and documented. Deductions for management, technical and royalty fees to related non-residents are capped at 2% of turnover, and the fees bear withholding tax.
Is there tax on dividends from my Rwandan subsidiary to my Rwandan holding?
No. Dividends between resident companies are exempt from corporate tax and withholding tax.
What if I sell my foreign holding company?
An indirect transfer of shares in a Rwandan company can be taxed in Rwanda at 10%, even if the sale happens abroad.
Next steps