VAT and electronic invoicing: the 18% and 0% rates, registration and returns, the exemptions after Law N° 009/2025, input tax and refunds, imported services, VAT on online supplies by non-residents, and the 2026 electronic invoicing rules

The VAT framework at 10 October 2026

VAT is governed by Law N° 049/2023 of 05/09/2023 establishing value added tax (the VAT Law), published in the Official Gazette n° Special of 14/09/2023 and in force on publication, which replaced Law N° 37/2012. It was amended by Law N° 009/2025 of 27/05/2025, one of the seven tax laws gazetted on 29 May 2025, which replaced the list of exempt goods and services in Article 8. Registration, invoicing, assessment and penalties are governed by Law N° 020/2023 of 31/03/2023 on tax procedures (the Tax Procedures Law). Ministerial Orders fill in the detail: Ministerial Order N° 001/25/10/TC of 16/04/2025 lists the financial and insurance services that are exempt, Ministerial Order N° 003/24/03/TC of 08/03/2024 governs authorisation to deduct VAT on foreign services, Ministerial Order N° 004/26/10/TC of 29/04/2026 governs online supplies, and Ministerial Order N° 006/26/10/TC of 24/09/2026 governs electronic invoicing.

VAT is charged on taxable goods and services supplied in Rwanda, including online supplies, and on taxable imports (Article 3). The rate is 18%, or 0% for zero-rated supplies (Article 4). All goods supplied by a taxpayer in Rwanda are taxable unless exempt. A service is supplied in Rwanda, under Article 6, where the provider and the recipient are both resident in Rwanda, or where either of them is resident in Rwanda and the service is useful to the recipient in Rwanda. Business assets sold by a taxpayer are taxable unless input tax was denied on them, assets held on deregistration bear the tax, and goods taken for personal use are taxed. A public procuring entity withholds the VAT on all payments to VAT-registered winning bidders and pays it to RRA itself (Article 5(3)). The tax point is the earliest of the invoice, payment (other than advance payments in construction), delivery of goods, performance of the service or an application to deregister (Article 12).

Registration, returns and payment

Under Article 11 of the Tax Procedures Law, a person carrying on taxable activities whose turnover exceeded RWF 20,000,000 in the previous fiscal year, or RWF 5,000,000 in the preceding quarter, must register for VAT within seven days from the end of that year or quarter, unless its business is exempt. A person below the thresholds may register voluntarily, which suppliers to VAT-registered customers and exporters often do in order to recover input tax. Registration is made with the Registrar General at the Rwanda Development Board (RDB), and RRA registers a person that meets the threshold but fails to register, notifying it immediately. Changes are notified within seven days, and RRA issues the registration certificate electronically (Article 30 of the VAT Law). An enterprise with several branches registers once, under one taxpayer identification number (Article 31).

Under Article 28 of the VAT Law, a taxpayer whose annual turnover is RWF 200,000,000 or less declares VAT quarterly within 15 days after the end of each quarter, and may opt for monthly declarations; a taxpayer above RWF 200,000,000 declares monthly within 15 days after the end of each month. A return must be filed for every period, whether or not there were sales, tax to pay or a refund to claim. Payment is due within the same 15 days (Article 29), and VAT on imports is due when the goods enter the customs point. Some secondary sources describe monthly filing as the default with a quarterly option; the law makes quarterly filing the default for taxpayers at or below RWF 200,000,000, and the same threshold governs quarterly PAYE under Article 21 of the Tax Procedures Law.

Zero-rating and the exemptions after Law N° 009/2025

A zero-rated supply bears VAT at 0% but the supplier recovers its input tax. Article 7 zero-rates exported goods and their auxiliary services, exported services, minerals sold on the domestic market, international transport of goods entering Rwanda and transport of goods in transit with related services, the commission on all-inclusive tour packages, goods sold in duty-free shops and in shops for the security organs, and goods and services for diplomats, international organisations, donor-funded non-governmental organisations and donor-funded projects under agreements with Rwanda. An exempt supply bears no VAT, but the supplier cannot recover input tax on it, so an exemption is a cost for a business with significant inputs.

Article 8, as replaced by Law N° 009/2025, keeps exemptions for health and medical services and listed pharmaceuticals, equipment for persons with disabilities and sanitary pads; listed educational materials and services, supplied physically or online; books, newspapers and journals; passenger transport by licensed operators in vehicles of 14 seats or more, by air, and persons or goods by boat, and household waste transport; the sale or lease of land, the sale of residential buildings and residential lets of more than 90 days; finance leases by licensed institutions; financial and insurance services listed by Ministerial Order; unprocessed agricultural and livestock products and processed maize, rice and milk other than powdered milk; agricultural and livestock insurance and listed agricultural inputs; gaming; imports by licensed special economic zone users; defence and security supplies; aircraft and their parts; restructuring transfers between related residents; and securitisation transfers. Exemptions that existed under the 2023 list for the land transport of goods, mobile phones and SIM cards, information and communication technology equipment and services, and imported hybrid vehicles are not in the new list; only imported pure electric vehicles, their batteries and charging equipment remain exempt, until 30 June 2028. Law N° 009/2025 amended Article 8 only, so Article 7(1)(i), which zero-rates locally assembled electric and hybrid vehicles, their batteries and charging equipment, remains in the text, although the Ministry of Finance and Economic Planning (MINECOFIN) announced in February 2025 that VAT would be reintroduced for all hybrid vehicles; an assembler should confirm RRA's position.

Input tax: what can be recovered, and when

A taxpayer making taxable supplies may credit the input tax paid on taxable purchases and imports used for those supplies (Article 17). Where inputs serve both taxable and exempt supplies, only the proportion relating to taxable supplies is recoverable. Input tax is claimed with a VAT invoice from the electronic invoicing system for local purchases, or customs documents proving payment for imports (Article 19). If the documents are not held when the return is filed, the credit may be taken in a later return, provided the documents are not more than 12 months old (Article 17(6)). A newly registered taxpayer may claim input tax on stock held at registration in its first return (Article 18).

Article 20 denies input tax on passenger vehicles and their spare parts, repair and maintenance, unless the business sells or rents passenger vehicles or runs a driving school; on goods for entertainment, unless entertainment is the business; on accommodation, unless the business provides accommodation or the accommodation is for persons travelling away from home for the business; and on 40% of the VAT on goods and services whose business and personal use cannot be separated.

Services bought from abroad and online supplies by non-residents

A taxpayer that acquires a service from a person outside Rwanda is treated as if it had supplied the service to itself, under the reverse charge in Article 14: it declares output tax for the period in which the service was delivered, and the receipt justifying the payment abroad serves as the VAT invoice. It may deduct that output tax as input tax only where the service is not available in Rwanda, meaning that no one on the local market can provide an identical or similar service, and only with the Minister's prior authorisation under Ministerial Order N° 003/24/03/TC. In practice, VAT on most imported services, such as management, consulting and software support from a foreign group company, is a cost on top of the 15% withholding tax explained in Withholding taxes and tax treaties.

Ministerial Order N° 004/26/10/TC of 29/04/2026 brings online supplies to consumers into the net. A supplier outside Rwanda of taxable goods or services provided online to customers in Rwanda must register for VAT, or appoint a representative with a business in Rwanda to do so (Article 4); the Order sets no turnover threshold. A supply is made in Rwanda if the recipient is in Rwanda and benefits there, if it is consumed in Rwanda, or if the recipient's payment method, billing or home address, internet address, country code, SIM card or bank account is in Rwanda (Article 5). The tax point is the earliest of delivery, payment and the invoice or receipt (Article 6). A registered supplier or its representative files and pays by the 15th of the month after each tax period (Article 9). Where the supplier is not registered, the financial institution that processes the payment withholds the VAT and pays it by the 15th of the following month (Articles 8 and 9). A consumer may ask RRA for a refund within 60 days of payment if the price was returned or reduced (Article 7). A supplier in Rwanda of online services must register for VAT and present a certificate of registration from the Rwanda Utilities Regulatory Authority (RURA) (Article 4(3)). Suppliers were given three months from publication to comply (Article 25). The separate 1.5% digital services tax is described in Capital gains, property and other taxes.

Refunds and the consumer reward

Where input tax exceeds output tax, the surplus is refunded (Article 26). The claim must be made in the period to which it relates, and RRA refunds within 30 days from the day after the declaration or, where it decides that a comprehensive audit is needed before refunding, within 30 days from the day after the audit report. The refund is paid only where the VAT on the purchases matches the tax paid to RRA by the suppliers, so a supplier's failure to declare its sales can hold up the customer's refund. Investors registered under Law N° 006/2021 on Investment Promotion and Facilitation are entitled to refunds within 15 days of RRA receiving the documents, except in VAT-exempt sectors, as described in Investment incentives; the 15-day period is not a general rule. Exporters, whose sales are zero-rated, are the most frequent refund claimants.

To encourage customers to ask for invoices, Article 27 grants a final consumer who presents an electronic invoice a reward on the VAT shown on it; RRA's guidance states the reward as 10% of the VAT, under Ministerial Order N° 002/25/10/TC of 16/04/2025. Embassies and international organisations recover VAT under the agreements with their states or organisations (Article 26(2)).

Electronic invoicing under Ministerial Order N° 006/26/10/TC

Article 17 of the Tax Procedures Law requires every person carrying on a taxable activity to issue invoices generated by an electronic invoicing system certified by RRA, and Article 18 obliges every user to have such a system, issue an electronic invoice to every buyer whether or not the buyer asks for it, show the real name of the goods and the tax rate (or, for unregistered sellers, the price), notify RRA of a system failure within six hours and not delete invoices without good reason. Ministerial Order N° 006/26/10/TC of 24/09/2026, published on 25 September 2026 and in force on publication, replaced Ministerial Order N° 002/13/10/TC of 31/07/2013 on the certified electronic billing machine (EBM). Under Article 3 of the new Order a user must obtain the system RRA specifies, or hold a valid service contract with a licensed supplier of an alternative system; keep it at the point of sale where customers can see it; display a notice with its name, address and TIN, the Sales Data Controller (SDC) serial number, whether it is VAT-registered, and the statement "do not pay if an invoice is not issued"; approve invoices initiated by buyers; generate delivery notes for stock moved within the company; ask RRA to deactivate the system when the business stops; issue certified cancellation receipts; report theft within 12 hours and damage within six hours, obtaining a new system within five working days if trading continues; and issue manual invoices in duplicate while the system is down, printing the electronic invoices once it is restored.

A business invoicing from an enterprise resource planning (ERP) system must integrate it with the electronic invoicing system as RRA prescribes (Article 4). Where the seller cannot issue an invoice, the buyer may initiate it and the seller must approve it (Article 5). Each invoice must show at least the seller's name and TIN, a buyer identification number (a TIN, a telephone number or nine zeroes), the place of sale, the buyer's telephone number, invoice and transaction type, an unbroken serial number, the description, quantity and price of goods or services, the total, the tax rates, the means of payment, any discount and the SDC data (Article 6). A person not required to file an annual income tax return need not use the system for every transaction, but must approve buyer-initiated invoices (Article 8). RRA monitors compliance by data analytics and by inspectors in business centres (Article 9). The same Order sets the procedure for a taxpayer in financial hardship to apply for a waiver of penalties and interest, which the Minister may grant, with any waiver of principal tax decided by the Cabinet (Articles 10 and 11), and grants a person who reports tax evasion 5% of the principal tax recovered, up to RWF 10,000,000 (Article 12).