The Ultimate Guide to Business Taxes in Africa: What You Need to Know - Uganda
Updated: Mar 28
Are you a business owner operating in Africa? If so, you know that paying taxes is an essential part of running your business. Business taxes can be complicated and overwhelming, but don't have to be. Whether you are a new business owner or an experienced one, this post will provide you with valuable summarized insights on business taxes and keep your business running smoothly. Below is a breakdown per country so grab a cup of coffee and let's dive in!
From small enterprises to large corporations, all businesses in Uganda are required to comply with the tax laws and regulations set forth by the Uganda Revenue Authority (URA). Below is a breakdown of what you need to know as a business owner to stay compliant and avoid penalties. So, let's get started!
Tax/Due | ​Description | Who Pays | ​How to Submit | Online Form | PDF Form |
Pay As You Earn (PAYE) | ​Tax deducted from employment income of employees and remitted to URA by employers on a monthly basis | ​Employers | Submit form online at URA's eTax Portal or in person at any URA office | PAYE_Return .xls Download XLS • 2.71MB | ​ |
Value Added Tax (VAT) | Tax charged on taxable supplies of goods and services made by VAT-registered businesses | VAT-registered businesses | Submit form online at URA's eTax Portal or in person at any URA office | VAT Return .xls Download XLS • 346KB | Monthly VAT Return Form .pdf Download PDF • 544KB |
Income Tax Return | Tax on business income. Tax rate varies depending on income type and tax bracket. | All businesses | Submit form online at URA's eTax Portal or in person at any URA office | Income Tax Return .xls Download XLS • 1.18MB | Income Tax Return .pdf Download PDF • 1.72MB |
Excise Duty | Tax charged on specific goods and services like alcohol, tobacco, and petroleum products | Manufacturers, importers, and suppliers of excisable goods and services | Submit form online at URA's eTax Portal or in person at any URA office | Local_Excise_Duty_Return .xls Download XLS • 1.78MB | Excise Duty Return .pdf Download PDF • 565KB |
Rental Tax | Tax charged on rental income from commercial and residential properties | Property owners and managers | Submit form online at URA's eTax Portal or in person at any URA office | Rental Tax Return .xls Download XLS • 377KB | Rental Tax Return .pdf Download PDF • 954KB |
Withholding Tax | Tax deducted from payments made to non-residents for services rendered in Uganda | Businesses making payments to non-residents | Submit form online at URA's eTax Portal or in person at any URA office | Withholding Tax Return .xls Download XLS • 412KB | ​ |
Local Service Tax | Tax charged on all persons earning income within the jurisdiction of KCCA | Individuals and businesses earning income within KCCA jurisdiction | Pay at any URA office or through mobile money | ​ | ​ |
Trading License | Fee charged on businesses operating within KCCA jurisdiction | All businesses operating within KCCA jurisdiction | Pay online on KCCA's Portal or in person at any KCCA office | ​ | Trading Licence .pdf Download PDF • 646KB |
Filing Deadlines
Tax Type | Filing Frequency | Filing Deadline | Annual Return Deadline | Who is required to file | Penalties for late/non-filing | Exceptions |
Value Added Tax (VAT) | Monthly | 15th of following month | 31st January of following year | VAT-registered businesses | Penalty of 2% of tax due per month or part of the month, subject to a maximum of 100% of tax due | Businesses with turnover below UGX 150 million per year may apply for exemption |
Pay-As-You-Earn (PAYE) | Monthly | 15th of following month | N/A | Employers with salaried employees | Penalty of 1% per month or part of the month on the outstanding tax balance | N/A |
Corporation Tax | Annually | 6 months after accounting period end date | N/A | Companies and other corporate entities | Penalty of 1% per month or part of the month on the outstanding tax balance | N/A |
Withholding Tax | Monthly | 15th of following month | N/A | Businesses making payments subject to withholding tax | Penalty of 2% of tax due per month or part of the month, subject to a maximum of 100% of tax due | N/A |
Excise Duty | Monthly | 15th of following month | N/A | Businesses engaged in the manufacture, import or sale of excisable goods | Penalty of 2% of tax due per month or part of the month, subject to a maximum of 100% of tax due | N/A |
KCCA Trade License | Annually | 31st January of each year | N/A | Businesses operating within KCCA jurisdiction | Penalty of 10% of the annual fee plus UGX 500,000 for late renewal | N/A |
NSSF Contributions | Monthly | 15th of following month | N/A | Employers with salaried employees | Penalty of 5% of the total contribution due plus 1% for each month or part of the month that the contribution remains unpaid | Employers with less than 5 employees are exempt |
E-invoicing/E-receipting | Monthly | 15th of following month | N/A | Businesses required to issue e-invoices and e-receipts | Penalty of UGX 500,000 for non-compliance | N/A |
Company Registration Renewal | Annually | Within 30 days of anniversary of registration date | N/A | All registered businesses | Penalty of UGX 50,000 plus UGX 20,000 per month or part of the month that the renewal is late | N/A |
URSB Annual Return Filing | Annually | 31st January of each year | N/A | All registered businesses | Penalty of UGX 400,000 for late filing | N/A |
URA eFRIS (Electronic Fiscal Receipting and Invoicing System)
Is an online platform introduced by the URA to monitor sales transactions and automate the generation of receipts and invoices for businesses in Uganda. It is intended to help businesses improve their accounting processes and make it easier for them to comply with tax regulations.
Note that businesses that have a turnover of less than UGX 50 million per year are not required to register for e-invoicing and e-receipting. However, they are encouraged to do so as it can help them improve their accounting processes and make it easier to comply with tax regulations.
The requirements and registration process for e-invoicing and e-receipting with URA's eFRIS system:
Obtain a Tax Identification Number (TIN) - To register for e-invoicing and e-receipting, businesses must have a TIN.
Register for eFRIS - Businesses must register for the eFRIS system by visiting the URA website and creating an account.
Obtain a Digital Signature Certificate (DSC) - Businesses must obtain a DSC from a URA-approved service provider. The DSC is used to sign electronic invoices and receipts, ensuring their authenticity and integrity.
Integrate with accounting software (optional) - Businesses can integrate their accounting software with the eFRIS system to enable them to generate e-invoices and e-receipts directly from their accounting systems.
Test the system - Before using the eFRIS system for actual transactions, businesses must test the system to ensure that it is working correctly.
Start using the system - Once the business has successfully completed the registration process and obtained a DSC, they can start using the eFRIS system to generate and submit e-invoices and e-receipts to URA.
With the right mindset and approach, you can turn taxes from a burden into an opportunity to grow and thrive as a business owner. Paying taxes is an essential part of running a business, but it doesn't have to be a source of stress or frustration. With WABZ, businesses of all sizes can enjoy the benefits of efficient bookkeeping, including better cash flow management, improved decision-making, and reduced paper-work come tax season.
Coming soon in our Africa series
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Kenya
Ghana
Tanzania
South Africa
Zimbabwe