List Of Taxes In Uganda

List Of Taxes In Uganda

Formally, a taxe is levied on transactions, such as a sales tax or stamp duty, while an impôt is a compulsory charge, such as assessed on persons – an income tax, a poll tax, or a property tax, and the like.

Taxation in Uganda

At Grant Thornton, we appreciate the unique nature of tax law and the fundamental principles that underlie its interpretation and application. Our team of experts are at hand to offer tax solutions for all business categories.

Tax Administration

Taxes in Uganda are centrally assessed and collected by the Uganda Revenue Authority (URA), headed by a Commissioner General.

Within the organisational structure of URA, two operational departments (Domestic Taxes and Customs) headed by Commissioners are directly responsible for the assessment and collection of revenues resulting from the tax laws below:

1. Customs Tariff Act, Cap. 337;

2. East African Customs Management Act;

3. East African Excise Management Act;

4. Excise Tariff Act, Cap. 338;

5. Income Tax Act, Cap. 340;

6. Stamps Act, Cap. 342;

7. Traffic and Road Safety Act, Cap. 361;

8. Value Added Tax Act, Cap. 349;

9. Finance Acts (Various);

10. Gaming and Pool Betting (Control and Taxation) Act, Cap.292;

Income Tax

In Uganda, income tax applies generally to all types of persons who derive income, whether an individual, bodies of individuals, or corporate entities. Resident persons are taxed on worldwide

income, while non-resident persons are taxed only on income derived from sources in Uganda.

Income tax is imposed on three broad categories of income – Business income, Employment

income and Property income.

Most of the taxes imposed are self-assessed. The self-assessment system imposes on the

taxpayer, in the first instance, responsibility for calculating taxable income and the tax due on that income. The taxpayer’s calculations may however be reviewed by revenue officials when returns are filed and may be subject to further audit.

Tax rates for Individuals in Business

The income tax rate for individuals depends on the income bracket in which the individual falls.

Resident individuals enjoy a tax free annual income threshold of UGX. 2,820,000 per annum.

The balance is taxed at 10%, 20% or 30% depending on the income bracket. Individuals who earn above UGX 120,000,000 pa pay an additional 10% on the income above 120m.

CHARGEABLE INCOME (CY) RATE OF TAX
UGX (Annual) Residents Non-residents
0 to 2,820,000 Nil CY x 10%
2,820,000 to 4,020,000 (CY – 2,820,000) x 10% CY x 10%
4,020,000 to 4,920,000 (CY – 4,020,000) x 20% + (120,000) (CY – 4,020,000) x 20% + (402,000)
4,920,000 to 120,000,000 (CY – 4,920,000) x 30% + (300,000) (CY – 4,920,000) x 30% + (582,000)
Above 120,000,000 [(CY – 4,920,000) x 30% + (300,000)]
+ [(CY – 120,000,000) x 10%]
[(CY – 4,920,000) x 30% + (582,000)]
+[(CY – 120,000,000) x 10%]

Tax rates for Individuals in Employment

Employers are required by law to deduct tax from an employee’s salary or else they become personally liable for the tax that should have been deducted. The monthly PAYE (Pay As You Earn)rates are shown below:

CHARGEABLE INCOME (CY), RATE OF TAX, UGX (MONTHLY) RESIDENTS NON-RESIDENTS
0 to 235,000 Nil CY x 10%
235,000 to 335,000 (CY – 235,000) x 10% CY x 10%
335,000 to 410,000 (CY – 335,000) x 20% + (10,000) (CY – 335,000) x 20% + (33,500)
410,000 to 10,000,000 (CY – 410,000) x 30% + (25,000) (CY – 410,000) x 30% + (48,500)
Above 10,000,000 [(CY – 410,000) x 30% + (25,000)]
+[(CY – 10,000,000) x 10%]
[(CY – 410,000) x 30% + (48,500)]
+[(CY – 10,000,000) x 10%]

Tax rates for Companies

The income tax rate for a company i.e. a body of persons, corporate or unincorporated, created or recognised under any law in Uganda or elsewhere, is 30% of the entity’s CHARGEABLE INCOME i.e. gross income less tax allowable deductions.

For non-resident companies, an additional 15% tax may become chargeable on repatriated branch profits.

Tax rates for Small Businesses

Resident persons with a turnover of less than UGX 50m are taxable at Presumptive rates below:

GROSS TURNOVER PER ANNUM (UGX) TAX (FINAL)

Not exceeding 5 million NIL

Exceeding 5 million but not exceeding 20 million

Exceeding 20 million but not exceeding 30 million

The lower of 250,000 or 1% of gross turnover.

Exceeding 30 million but not exceeding 40 million

The lower of 350,000 or 1% of gross turnover.

Exceeding 40 million but not exceeding 50 million

The lower of 450,000 or 1% of gross turnover.

Tax on Rental income derived by individuals

Tax on rental income derived by an individual is assessed separately from the individual’s other business incomes or employment income. The tax is 20% of the rental income amount after

deducting –

1) 20% as allowable expenses; and

2) UGX 2,820,000 as a tax free threshold.