Tax laws Uganda
Uganda's tax system is structured to generate revenue for national development while aligning with international taxation standards. The Uganda Revenue Authority (URA), established in 1991, is responsible for enforcing, assessing, collecting, and accounting for various taxes in Uganda.
Key Components of Uganda's Tax System:
Income Taxes:
Individual Income Tax:
- Progressive Tax Rates: Resident individuals are taxed on a progressive scale with rates of 10%, 20%, and 30%, depending on income brackets. An additional 10% tax is levied on annual income exceeding UGX 120 million. citeturn0search0
- Tax-Free Threshold: An annual tax-free threshold of UGX 2,820,000 is provided for resident individuals. citeturn0search0
- Withholding Taxes (WHT): A standard WHT rate of 15% applies to various payments, including employment income, dividends, and interest.
Corporate Income Tax:
- Tax Rate: Resident companies are subject to a corporate tax rate of 30% on their chargeable income.
- Presumptive Tax: Companies with an annual turnover not exceeding UGX 150 million may qualify for presumptive tax, which offers simplified taxation based on turnover.
Value Added Tax (VAT):
- Standard Rate: VAT is levied at a standard rate of 18% on the supply of goods and services.
- Exemptions: Certain goods and services are exempt from VAT, as specified in the VAT Act. citeturn0search4
Withholding Taxes (WHT):
- General Rate: A WHT rate of 15% is applicable to various payments, including dividends, interest, and royalties.
- Goods and Services: A WHT rate of 6% is levied on payments for goods and services supplied in Uganda. citeturn0search2
Recent Amendments:
- In 2024, Uganda enacted amendments affecting income tax, VAT, excise tax, stamp duties, and tax procedures. These changes aim to enhance revenue collection and align with international tax standards. citeturn0search3
Tax Administration:
The Uganda Revenue Authority (URA) oversees tax collection and enforcement. The URA operates under the Ministry of Finance, Planning and Economic Development, with its headquarters located in Kampala. The agency aims to collect taxes efficiently, treat taxpayers with respect, and ensure effective implementation of tax policies and laws.
Conclusion:
Uganda's tax system is designed to support national development through a structured and progressive taxation framework. Compliance with tax obligations is essential for individuals and businesses operating within the country. For the most current and detailed information, consulting the Uganda Revenue Authority or a tax professional is recommended.
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