Rwanda has implemented new transfer pricing regulations through Ministerial Order No. 003/26/10/tc of 29 April 2026, introducing a formal framework for Advance Pricing Agreements and replacing the 2020 rules that ceased application in October 2023.
Rwanda has introduced new transfer pricing rules establishing a clearer tax framework for controlled transactions, replacing the 2020 rules, which ceased to apply in October 2023 under the amended Income Tax Law No. 027/2022.
The updated transfer pricing rules were established through Ministerial Order No. 003/26/10/tc of 29 April 2026, which establishes comprehensive guidelines for transfer pricing between related parties and introduces a simplified accounting method specifically for small businesses.
This order also details the criteria under which a taxpayer may receive authorisation to carry forward financial losses for a period exceeding five years.
The new Ministerial Order relating to transfer pricing in Rwanda introduces a formal framework for Advance Pricing Agreements (APAs), which are agreements between the tax administration and a taxpayer regarding the application of the arm’s length principle to controlled transactions.
Scope and application
A taxpayer may apply for an APA before entering into one or more controlled transactions. Additionally, the rules allow for applications concerning controlled transactions that have already been entered into.
A taxpayer can request to “roll back” the terms of an APA to cover one or more prior tax years, provided this does not exceed two years preceding the APA term.
For transactions involving related persons in countries with a tax treaty with Rwanda, taxpayers may request bilateral or multilateral APAs. In such cases, the Rwandan tax administration will contact the relevant foreign competent authorities to analyse and respond to the request.
Eligibility and requirements (Article 28)
To request an APA, a taxpayer must meet specific criteria and fulfill the following requirements:
- Submit a written APA proposal to the Commissioner General of the Rwanda Revenue Authority.
- The controlled transaction(s) must have a value of at least RWF 100 million.
- The taxpayer must have an annual turnover of at least RWF 600 million.
- Pay a non-refundable processing fee of RWF 6 million.
- Applications must be submitted through a portal designated by the tax administration.
The APA proposal content
As per Article 28(2), the proposal must include detailed information, such as:
- Descriptions of commercial activities and the proposed scope/duration of the APA.
- Identification of related parties and permanent establishments involved.
- The proposed transfer pricing method, comparability factors, and assumptions regarding future events.
- Relevant transfer pricing documentation (local/master files) as required under Article 17.
Timeline and process
Although no specific deadline is set for the initial analysis stage, the rules establish a timeline for finalising the agreement. If the tax administration accepts an application, the taxpayer is invited to begin negotiations, with a pre-application meeting possible before formal submission to discuss the required information. Once both parties agree on the arm’s length approach, the tax administration must prepare the APA within 45 days of the final engagement. The agreement becomes effective only after it is signed by both parties, and an application is treated as withdrawn if the taxpayer does not sign within 30 days of receiving the invitation to do so.
Validity and compliance
An APA is valid for three years and may be renewed once upon request.
For every income tax year covered by the APA, the taxpayer must submit an APA compliance report on the same date they file their income tax return.
An APA can be rendered null and void if the taxpayer breaches its conditions, engages in tax evasion, or if the actual business situation deviates significantly from the facts agreed upon in the APA.
