How Much Does It Cost To Open A Company In Uganda

A company is a legal entity formed by a group of individuals to engage in and operate a business—commercial or industrial—enterprise. A company may be organized in various ways for tax and financial liability purposes depending on the corporate law of its jurisdiction.

Cost To Opening A Company In Uganda

In Uganda, a business can be registered either as a sole proprietorship under a business name, a company limited with shares or a company by guarantee akin to a not-for-profit organization.

The difference is based mainly on the structure and the number of members of a business. Provia explained more about each of these options.

Sole proprietorships consist of a single person who wants to do business under a legal entity.

These businesses are typically smaller in nature and consist of individuals seeking to trade and operate alone while expanding their businesses through credit, investment, and partnership opportunities that formalization affords them.

To register a sole proprietorship with the URSB and receive a business certificate, business owners must submit an online form and pay a one-time registration fee of 24,000 UGX.

Once those compliance requirements have been fulfilled, businesses are free to begin trading as officially recognized entities.

Registering a company – a process called ‘incorporation’ – is slightly more complex than registering as a sole proprietorship.

Compared to sole proprietorships, companies have many more types, structures, and responsibilities, but they stand as distinct legal entities separate from their owners, which protects owners from the company’s legal liabilities.

While companies are typically structured to involve multiple people, they can also be structured as ‘single-member” companies for people working independently.

The most common companies registered by URSB, according to Provia, are private companies with shares distributed amongst multiple owners.

Business owners can also register either a public company that sells stock and part of their shares to the public, unlimited companies, foreign companies or a not-for-profit company limited by guarantee.

Regardless of what type of company business owners register, there are more obligations to ensure full compliance when compared to registering as a sole proprietor.

Requirements For Opening Up A Company In Uganda

For instance, companies must indicate the total amount of starting capital, which is then used to determine the company’s incorporation fees.

Fixed costs associated with incorporation include a 20,000 UGX name reservation and 40,000 UGX to submit two forms. Variable costs include the registration fee – totaling 1% of share capital – and the stamp duty – which has a cost of 0.5% of share capital, as well as a 135,000 UGX fixed fee.

Once the incorporation fees are paid, a certificate of incorporation is issued as part of the initial filing process.

At this point, companies must submit forms listing the names of their directors and secretary and their business location and provide a memorandum and article of associations outlining the company’s interests.

After the registration is finalized and a certificate of incorporation is issued, the company goes into business.

For a company limited with shares, annual returns must be submitted every year to declare the status of operations along with a 50,000 UGX fee (30,000 UGX for companies limited by guarantee). Any changes to the company’s structure or directors must be declared on the form to keep the business registration up to date.

Can a foreigner open a company in Uganda?

There are no restrictions on foreign ownerships of businesses in Uganda. Uganda encourages capital inflow in various forms. Foreigners are free to operate businesses in Uganda subject to limited regulatory requirements. They are also free to hold investments in the country.

How long does it take to register a company in Uganda?

Certificate of incorporation; when you submit relevant documents, the process may take up to 3-7days to pick up your certified copies and certificate of incorporation.