Income tax in Uganda

April 10, 2018

INDIVIDUAL TAXATION

Residents of Uganda are taxed on their worldwide income. Married couples are taxed separately.

The tax year is from 01 July of the current year to 30 June of the succeeding year. The tax year 2017 is from 01 July 2017 up to 30 June 2018. The tax year 2018 is from 01 July 2018 up to 30 June 2019.

INCOME TAX

All income, excluding rental income, is generally aggregated and is subject to progressive income tax rates. Expenditure and losses incurred in the production of income are deducted from the gross income.

INCOME TAX FOR RESIDENTS

TAXABLE INCOME, UGS (US$)
TAX RATE
Up to 2,820,000 (US$762) 0%
2,820,000 - 4,020,000 (US$1,087) 10% on band over US$762
4,020,000 - 4,920,000 (US$1,330) 20% on band over US$1,087
4,920,000 - 120,000,000 (US$32,432) 30% on band over US$1,330
Over 120,000,000 (US$32,432) 40% on all income over US$32,432
Source: Global Property Guide

Residents are entitled to some deductions such as life insurance premiums and contributions to retirement funds.

RENTAL INCOME
Rental income is taxed separately from other sources of income. Rental income tax is levied at a rate of 20% on the net rental income. A standard deduction of 20% of the gross income is given to account for income-generating expenses such as repair and maintenance costs. A tax threshold is also granted annually and currently the tax-free allowance is UGS2,820,000 (US$762).

RENTAL INCOME TAX FOR RESIDENTS

TAXABLE INCOME, UGS (US$) TAX RATE
Up to 1,560,000 (US$762) 0
Over 1,560,000 (US$762) 20% on all income over US$762
Source: Global Property Guide

CAPITAL GAINS
No capital gains tax is levied in Uganda.

However, capital gains from business is considered as income and taxed at the standard progressive income tax rates.

PROPERTY TAX


Property Tax

Property taxes are levied by the local governments and the tax base is the rateable value of the property (which takes into account the nature of the property concerned and value of improvements). The tax rates are determined by the local authorities but a maximum of 2% is prescribed by law.

CORPORATE TAXATION

INCOME TAX

Income and capital gains earned by companies are generally taxed at a flat rate of 30%. Income-generating expenses are deductible when calculating taxable income.

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