Registration of a company in Rwanda

Rwanda is a relatively poor African country that has recently taken active steps to attract foreign investment. A loyal tax regime and a stable growth of GDP make this area particularly attractive to foreign entrepreneurs. Setting up a company in Kigali or any other city in Rwanda will open investor access to the African market. Its cumulative number of consumers is about 150 million people. Moreover, buying a company in Rwanda will allow not only free trade but also to engage in other types of businesses. The country has a developing mining sector, infrastructure, tourism, industry, and agriculture.

Advantages of registering a company

• high level of security;
• stable legislation and economic environment;
• ease of capital repatriation;
• availability of tax preferences.

Main forms of legal presence and doing business

• limited liability company (SARL);
• limited liability company (SA);
• protected cellular company (PCP);
• partnership;
• affiliate.

Many foreign investors opt to establish their business in Rwanda as a SARL, a private limited liability company. To register such a company, you only need at least one shareholder, and there is no obligatory minimum share capital except for specific industries. Furthermore, the company must have a legal address registered in the country.

Registration procedure

Registration of a company in Rwanda is done at the Rwanda Development Board (RDB). The process includes obtaining these documents at the same time:

• Company registration certificates;
• Tax registration with an identification number (TIN);
• Social Security registration.

After visiting the ORG, the entrepreneur must:

• open a bank account;
• obtain a license to operate.

Legislation and regulatory environment

The main legal act regulating the activity of foreign entrepreneurs in Rwanda is the Investment Code. Establishing and operating a firm is also regulated by the Companies Law, the Partnership Law, the Tax Procedures Law, and others. Knowledge of the Capital Market Corporate Governance Code will be helpful for owners of public companies.

Tax system

• corporate tax – 30%;
• PIT – 30%;
• VAT -18%;
• dividend tax – 15%;
• capital gains tax – 5%.

Buying a business in Rwanda is profitable, given the incentives outlined in the Investment Code. They allow you to get the following:

• 7-year tax vacations on investments in priority sectors of the economy of at least $50 million;
• 0% corporate tax rate for international companies with regional offices in Rwanda and meeting specific requirements;
• 5-year tax vacations for microfinance institutions and founders of innovation parks;
• reduced corporate tax rate of 15% for the activities mentioned in the Order of the Minister of Finance.

In addition, micro-enterprises (with a turnover of less than 12 million Rwandan Francs during the tax period) pay a fixed amount of corporate tax. On the other hand, small companies, whose turnover is between 12 and 20 million Rwandan Francs per tax period, pay a lump sum tax at the rate of 3% of the turnover.

Open a business in Rwanda: how Prifinance lawyers can assist

Doing business in Rwanda is more accessible than in most African countries. It has stable legislation, and bureaucratic procedures are simplified. Nevertheless, one can only do it with professional legal advice because many formalities must be handled before starting a business. Prifinance company lawyers will support you to establish a company in Rwanda by finding the best legal form according to the client’s goals and interests. In addition, we will assist to understand the nuances of local legislation and provide accounting services and annual company maintenance.