Many businesses in Rwanda pay more tax than they should – or face penalties – because of simple mistakes. The good news: most of these problems can be avoided with better systems and support.
Here are seven common tax mistakes we see:
- Mixing personal and business money
Using the same bank account for everything creates confusion. It becomes hard to prove which expenses are business-related, and your real profit is unclear. A separate business account makes life much easier. - Poor record-keeping
If you wait until year-end to look for receipts and invoices, documents will be missing. This leads to errors in your tax returns and stress during an audit. Keeping records updated every month is safer. - Late or incorrect tax returns
Missing deadlines or submitting wrong figures can lead to penalties and interest. A simple calendar and support from a tax professional helps you file correctly and on time. - Not understanding what is deductible
Some businesses claim too little and pay more tax than necessary. Others claim too much and risk penalties. It is important to know which expenses are allowed, and how to document them properly. - Ignoring changes in tax rules
Tax regulations change over time. What was correct three years ago may not be correct today. Someone needs to follow updates and adjust your processes accordingly. - No tax planning
If you only think about tax once a year, you may face cash-flow problems when payments are due. Planning ahead helps you spread costs and avoid surprises. - Trying to do everything alone
As your business grows, tax becomes more complex. Working with a professional firm reduces risks and gives you peace of mind.
At NSP, we help businesses in Rwanda stay compliant, avoid penalties and manage tax in a smart way. If you want support with your tax situation, get in touch with our team.
