Cathy_

[J. Samuel Richards & Associates | CPA @JSRConsult]

TAX TIP TUESDAY
Vicious cycle – Uganda’s tax interest and penalties waivers

The Uganda Tax Procedures Code Act (TPCA), provides for specific waivers of interest and penalties. The interest is calculated at a rate of 2% per month, compounded.

The following is a chronology of the amendments to the TPCA since 2020:
i.TPCA Sec 40C: Waiving tax interest/penalties as at 30 June 2020;
ii.TPCA Sec 40D: Waiving tax interest/penalties as at 30 June 2023;
iii.TPCA Sec 47A: Extension of 40D waiving tax interest/penalties as at 30 June 2023;
iv.TPCA Section 47B: Waiving tax interest/penalties as at 30 June 2024.

With the current deadline of 30 June 2026 looming, Uganda Government is thinking of another waiver. In all the above, the deadlines came and passed but the tax payers remained grappling with huge tax bills outstanding. Consequently, the interest and penalty waivers has become a vicious cycle. One of the solutions is to consider reducing tax interest rate from 2% to 0.5% per month, simple interest.

By: CPA Dr. Albert Richards Otete
[email protected]

[J. Samuel Richards & Associates | CPA @JSRConsult]

𝗜𝗡𝗣𝗔𝗦 𝗮𝗻𝗱 𝘁𝗵𝗲 𝗙𝘂𝘁𝘂𝗿𝗲 𝗼𝗳 𝗡𝗣𝗢 𝗙𝗶𝗻𝗮𝗻𝗰𝗶𝗮𝗹 𝗥𝗲𝗽𝗼𝗿𝘁𝗶𝗻𝗴 𝗶𝗻 𝗨𝗴𝗮𝗻𝗱𝗮
A 𝗻𝗲𝘄 𝗲𝗿𝗮 is taking shape for non-profit organizations.
The introduction of the 𝗜𝗻𝘁𝗲𝗿𝗻𝗮𝘁𝗶𝗼𝗻𝗮𝗹 𝗡𝗼𝗻 𝗣𝗿𝗼𝗳𝗶𝘁 𝗔𝗰𝗰𝗼𝘂𝗻𝘁𝗶𝗻𝗴 𝗦𝘁𝗮𝗻𝗱𝗮𝗿𝗱 (𝗜𝗡𝗣𝗔𝗦) signals a 𝗺𝗮𝗷𝗼𝗿 𝘀𝗵𝗶𝗳𝘁 in how NPOs report, communicate, and demonstrate impact both globally and here in Uganda.

Officially launched on 𝟮𝟭 𝗢𝗰𝘁𝗼𝗯𝗲𝗿 𝟮𝟬𝟮𝟱 under the 𝗜𝗙𝗥𝟰𝗡𝗣𝗢 𝗶𝗻𝗶𝘁𝗶𝗮𝘁𝗶𝘃𝗲, INPAS is the result of 𝗼𝘃𝗲𝗿 𝘀𝗶𝘅 𝘆𝗲𝗮𝗿𝘀 𝗼𝗳 𝗴𝗹𝗼𝗯𝗮𝗹 𝗰𝗼𝗹𝗹𝗮𝗯𝗼𝗿𝗮𝘁𝗶𝗼𝗻 to build a dedicated accounting framework tailored specifically for the non-profit sector.
In Uganda, stakeholders were introduced to the standard in 𝗠𝗮𝗿𝗰𝗵 𝟮𝟬𝟮𝟲 during an NGO symposium hosted by @ICPAU1 (Institute of Certified Public Accountants of Uganda), where its 𝗽𝗿𝗮𝗰𝘁𝗶𝗰𝗮𝗹 𝗶𝗺𝗽𝗹𝗶𝗰𝗮𝘁𝗶𝗼𝗻𝘀 began to take center stage.
For years, many Ugandan NPOs have relied on a 𝗯𝗹𝗲𝗻𝗱 𝗼𝗳 𝗜𝗙𝗥𝗦, 𝗜𝗣𝗦𝗔𝗦, 𝗱𝗼𝗻𝗼𝗿-𝘀𝗽𝗲𝗰𝗶𝗳𝗶𝗰 𝗳𝗼𝗿𝗺𝗮𝘁𝘀, 𝗮𝗻𝗱 𝗶𝗻𝘁𝗲𝗿𝗻𝗮𝗹 𝗽𝗼𝗹𝗶𝗰𝗶𝗲𝘀. While functional, this mix often leads to 𝗶𝗻𝗰𝗼𝗻𝘀𝗶𝘀𝘁𝗲𝗻𝗰𝗶𝗲𝘀, especially in how 𝗴𝗿𝗮𝗻𝘁𝘀, 𝗿𝗲𝘀𝘁𝗿𝗶𝗰𝘁𝗲𝗱 𝗳𝘂𝗻𝗱𝘀, 𝗮𝗻𝗱 𝗽𝗿𝗼𝗴𝗿𝗮𝗺𝗺𝗲 𝗰𝗼𝘀𝘁𝘀 are presented.
𝗜𝗡𝗣𝗔𝗦 𝗰𝗵𝗮𝗻𝗴𝗲𝘀 𝘁𝗵𝗮𝘁.
As the 𝗳𝗶𝗿𝘀𝘁 𝗰𝗼𝗺𝗽𝗿𝗲𝗵𝗲𝗻𝘀𝗶𝘃𝗲, 𝘀𝘁𝗮𝗻𝗱𝗮𝗹𝗼𝗻𝗲 𝗮𝗰𝗰𝗼𝘂𝗻𝘁𝗶𝗻𝗴 𝘀𝘁𝗮𝗻𝗱𝗮𝗿𝗱 for non-profits, it offers a 𝗴𝗹𝗼𝗯𝗮𝗹𝗹𝘆 𝗵𝗮𝗿𝗺𝗼𝗻𝗶𝘇𝗲𝗱, 𝗮𝗰𝗰𝗿𝘂𝗮𝗹-𝗯𝗮𝘀𝗲𝗱 𝗳𝗿𝗮𝗺𝗲𝘄𝗼𝗿𝗸 designed to bring 𝗰𝗹𝗮𝗿𝗶𝘁𝘆, 𝗰𝗼𝗻𝘀𝗶𝘀𝘁𝗲𝗻𝗰𝘆, 𝗮𝗻𝗱 𝗰𝗼𝗺𝗽𝗮𝗿𝗮𝗯𝗶𝗹𝗶𝘁𝘆 to financial reporting across the sector.

𝗪𝗵𝗮𝘁 𝗱𝗼𝗲𝘀 𝘁𝗵𝗶𝘀 𝗺𝗲𝗮𝗻 𝗶𝗻 𝗽𝗿𝗮𝗰𝘁𝗶𝗰𝗲?
INPAS is expected to significantly enhance how NPOs account for:
• Donor funding and grant conditions
• Restricted vs Unrestricted funds
• Accrual-based reporting
• Programmed vs administrative cost allocation
• Comparability across organizations

While full adoption will depend on direction from regulators and professional bodies, 2026 is already shaping up as a transition year. Sensitization efforts are underway, and forward-looking organizations are beginning to align their systems, policies, and reporting frameworks in anticipation.
𝗪𝗵𝘆 𝘁𝗵𝗶𝘀 𝗺𝗮𝘁𝘁𝗲𝗿𝘀 𝗳𝗼𝗿 𝗨𝗴𝗮𝗻𝗱𝗮’𝘀 𝗡𝗣𝗢 𝘀𝗲𝗰𝘁𝗼𝗿
For organizations, especially those supported by international donors, INPAS presents a real opportunity to strengthen:
• Transparency and Accountability
• Donor confidence and funding credibility
• Financial statement comparability
• Governance and oversight

𝗠𝘆 𝗽𝗿𝗮𝗰𝘁𝗶𝗰𝗮𝗹 𝘁𝗮𝗸𝗲:
• Start familiarizing yourself with INPAS now, don’t wait for external pressure.
• Assess your current reporting framework against INPAS requirements
• Train your finance teams
• Engage your auditor early in the transition process
• Explore the standard at https://t.co/LSCHIUafc9

[J. Samuel Richards & Associates | CPA @JSRConsult]

@mofpedU
@URAuganda
A proposal is on the cards for landlords to file and pay rental tax on monthly basis. Apparently, the quarterly regime causes rental tax arrears.
Impact - UGX29billion in extra tax revenue.
Verdict: It may or may not lead to extra revenue. @URAuganda should SIMPLIFY rental tax return first. Alternatively, AUTOMATE the monthly like the one for VAT.

[J. Samuel Richards & Associates | CPA @JSRConsult]

Congratulations Ninsiima Collins on graduating from the CPA program.

The hard work paid off. 🤝

[Cathy_ @ketrac_]

@JSRConsult @ICPAU1 Congratulations Senior 🎊 👏

[J. Samuel Richards & Associates | CPA @JSRConsult]

Congratulations are in order for our Senior Associate at @JSRConsult , Collins Ninsiima, on reaching this milestone. 🎊🎓

He is now an Associate Member of @ICPAU1 - Institute of Certified Public Accountants of Uganda (ICPAU) and will soon become a practicing member.

We are proud to have supported such a dedicated talent and look forward to growing together in the profession. 🤝

[Cathy_ @ketrac_]

@BusingyeJose Congratulations 🎊

[G.L.O.W💋👅✨♛ @BusingyeJose]

Everybody say Congratulations Glow!🥹♥️

Happy Valentine’s from ME to ME!🥳

[J. Samuel Richards & Associates | CPA @JSRConsult]

𝗧𝗵𝗲 𝗛𝗶𝗱𝗱𝗲𝗻 𝗧𝗮𝘅 𝗥𝗶𝘀𝗸: 𝗘𝗺𝗽𝗹𝗼𝘆𝗲𝗲𝘀 𝗗𝗶𝘀𝗴𝘂𝗶𝘀𝗲𝗱 𝗮𝘀 𝗖𝗼𝗻𝘀𝘂𝗹𝘁𝗮𝗻𝘁𝘀

Misclassifying workers is one of the most overlooked tax risks for Ugandan businesses. URA looks at substance over form i.e. It’s how the relationship operates, not what the contract says, that determines PAYE obligations.

𝗘𝗺𝗽𝗹𝗼𝘆𝗲𝗲
• Works under supervision and control
• Has fixed hours and ongoing engagement
• Paid salary, allowances, and benefits
• Integrated into the organization
𝗧𝗮𝘅 𝗶𝗺𝗽𝗹𝗶𝗰𝗮𝘁𝗶𝗼𝗻: Employers must deduct and remit PAYE and NSSF contributions

𝗜𝗻𝗱𝗲𝗽𝗲𝗻𝗱𝗲𝗻𝘁 𝗖𝗼𝗻𝘀𝘂𝗹𝘁𝗮𝗻𝘁
• Operates independently
• Engaged for projects or specific deliverables
• Paid professional fees
• Manages their own tax obligations
𝗧𝗮𝘅 𝗶𝗺𝗽𝗹𝗶𝗰𝗮𝘁𝗶𝗼𝗻: PAYE does not apply, though withholding tax may apply

𝗞𝗲𝘆 𝘁𝗮𝗸𝗲𝗮𝘄𝗮𝘆
Classification should always reflect the actual working relationship. Misclassification can lead to retrospective PAYE assessments, penalties, interest, and NSSF liabilities.

[J. Samuel Richards & Associates | CPA @JSRConsult]

Tax Tip Tuesday 💡| What triggers a URA Tax Audit?

URA tax audits are largely risk-driven. Certain patterns in a taxpayer’s records, filings, and systems can raise red flags and prompt closer scrutiny.

Some of the most common triggers include:

1. Persistent losses or unusual financial trends
Repeated losses or sudden unexplained fluctuations in turnover or expenses may suggest that reported results do not reflect the true business position.

2. Inconsistencies in tax filings
Differences between income tax, VAT, PAYE, withholding tax returns, and EFRIS or third-party data often trigger audit reviews.

3. Related party transactions and third-party intelligence
Transactions with directors, shareholders, or affiliated entities such as management fees, interest, or royalties are closely examined. URA may also rely on information from banks, suppliers, customs, or whistleblowers.

4. Poor compliance history
Late filings, unpaid taxes, or prior audit adjustments increase a taxpayer’s risk profile and likelihood of future audits.

5. Weak EFRIS compliance
Failure to issue fiscalized invoices or frequent invoice cancellations reduces data reliability and attracts URA attention.

Key takeaway: Proactive compliance, accurate reporting, and proper documentation are essential for reducing audit risk and maintaining credibility with URA.

#TaxTipTuesday #URATax #TaxCompliance #EFRIS #AuditReadiness #BusinessInUganda

[Cathy_ @ketrac_]

@JSRConsult @ICPAU1 Congratulations Big man. March is about to be merrier

[J. Samuel Richards & Associates | CPA @JSRConsult]

Congratulations, Collins Ninsiima, on successfully completing your final CPA paper.

At J. Samuel Richards & Associates, we value continuous learning and are pleased to see our team members grow and reach important professional milestones.

Well done, Collins. We wish you continued success in your career and professional development. 👏🏽

[J. Samuel Richards & Associates | CPA @JSRConsult]

As the year comes to a close, we extend our sincere appreciation to our clients and colleagues for the trust and support throughout the year.

Wishing you a Merry Christmas and a prosperous New Year filled with growth and new opportunities. 🎄

[J. Samuel Richards & Associates | CPA @JSRConsult]

Check out my latest article: Government of Uganda Bond Auction Commentary - 26 November 2025. https://t.co/COykMuD1WO via @LinkedIn

[J. Samuel Richards & Associates | CPA @JSRConsult]

We’re excited to have Victoria join us as a new Associate at JSR. We look forward to helping you grow and develop your expertise in audit, consulting and beyond.

[Cathy_ @ketrac_]

@JSRConsult @Namulindwabren3 @DrOtete @rkatuntu7 @snilloc1101 @BusingyeJose @EvaNakakande All the best Brenda 👍

[J. Samuel Richards & Associates | CPA @JSRConsult]

Join us as we bid our colleague Brenda farewell.

Today, we celebrate you and the incredible 3 year journey you’ve had with us. From starting out as an Associate to rising to Senior Associate, your growth, dedication and professionalism have been truly inspiring.

You’ve been such a smart, dependable and positive member of the team — and your sense of humor has brightened so many days. We will miss you dearly.

Thank you for everything you’ve contributed to the firm. Wishing you all the very best in your next chapter. You will always be part of the JSR family.

[J. Samuel Richards & Associates | CPA @JSRConsult]

We’re pleased to welcome Jemimah to JSR as one of our new Associates. We look forward to supporting your growth as you build your skills in audit, consulting and other areas of the profession.

[J. Samuel Richards & Associates | CPA @JSRConsult]

Recently, @BOU_Official explained that SACCOs with savings of UGX1.5b and capital of UGX0.5b should apply for licence with BOU. This directive can help improve governance and risk management.

[J. Samuel Richards & Associates | CPA @JSRConsult]

In Sep 2025, @URAuganda wrote to @urbraUg clarifying taxation of income from Collective Investment Scheme (CIS - Unit Trusts), licensed by @CmaUganda . In Mar 2023, @JSRConsult Partner @DrOtete wrote in the New Vision advising that the income of a CIS is exempt from tax under Section 21(1)(t) of the Income Tax Act, Cap 338 to the extent of which the income is distributed to participants in the CIS. However, the income received by investors (e.g Pension Schemes) from the CIS would be taxed at 30%. This hopefully clarifies the matter for good. @ICPAU1 members can also take note during preparation and audit of financial statements.