What Is Local Service Tax?
This is a tax levied on salaries, wages and incomes of all persons in gainful employment and its purpose is to raise additional revenue service delivery in the Capital City.
How Much Is Local Service Tax In Uganda?
The computation of LST for professional is based on 2 bands. The professional who gets monthly income of UGX 1, 000,000 and above pays 100,000 as annual LST and those earning in between UGX 500,000 but not exceeding UGX 1,000,000 pay UGX 50,000 annually as tax.
What Should I Know About Local Service Tax In Uganda
Local service tax ranging between UGX 5,000 and UGX 100,000 per annum, subject to an individual’s employment income bracket, is payable to the local municipal councils of the individual’s area of residence. The tax is withheld and paid by the employer.
How Is Uganda Local Service Tax Calculated In Uganda?
The computation of LST for professional is based on 2 bands. The professional who gets monthly income of UGX 1, 000,000 and above pays 100,000 as annual LST and those earning in between UGX 500,000 but not exceeding UGX 1,000,000 pay UGX 50,000 annually as tax.
Who Is Eligible For Local Service Tax In Uganda?
This is a tax levied on wealth and incomes of all persons in gainful employment, self –employed and practicing professionals, self-employed artisans, business men/women and commercial farmers. Who is eligible to pay? -home salary exceeding Ugx 100,000.
What Are Things That Local Taxes Pay For In Uganda?
Local taxes fund government services including police and fire services, education and health services, libraries, road maintenance, and other programs and projects which benefit the community at large. Many of these services also receive federal funds in the form of grants.
What Is Local Services Tax Used For In Uganda?
Municipalities must use funds from an LST for police, fire or emergency services; road construction or maintenance; or the reduction of property taxes. Additionally, municipalities must use at least 25% of the revenues for emergency services. This limitation does not apply to the school district.
Who Has To Pay Local Services Tax In Uganda?
Any individual who is employed in a municipality/school district that levies a LST has to pay the tax. This tax is determined by where you work and not where you live.
How Are Local Taxes Calculated In Uganda?
Local taxes are generally computed based on a percentage of earned and unearned income, but the percentage will vary by location. Multiply the tax rate by your annual income. For example, if you earn UGX 153417320.00 a year and your local tax rate is 1%, your local taxes would be UGX 1534173.20 per year.
When Should Service Tax Is To Be Paid In Uganda?
Under Rule 4A of the Service Tax Rules, 1994, it is compulsory for a service tax assessee to issue a bill or invoice within 14 days from the date on which the taxable service was completed or the date on which the payment was received for the service, whichever comes first.