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Taxation Services

Your business will only achieve its true potential if you build it on strong foundations and grow it in a sustainable way. At FCK & Associates, we believe that managing your tax obligations responsibly can make a critical difference. Our global teams of talented people bring you technical knowledge, business experience and consistent methodologies, all built on our unwavering commitment to quality service -wherever you are and whatever tax services you need.

Effective compliance and open, transparent reporting are the foundations of a successful tax function. Tax strategies that align with the needs of your business and recognize the potential of change are crucial to sustainable growth. So we create highly networked teams who can advise on planning, compliance and reporting and maintain effective tax authority relationships — wherever you operate.

You can access our technical networks across the globe to work with you to reduce inefficiencies, mitigate risk and improve opportunity. Our tax people, indifferent countries, are committed to giving you the quality and consistency you need to support your tax function.

Financial Accounting Advisory Services

Our assurance professionals are experience to deliver relevant business and industry insights to you and our culture promotes internal teaming across all our service lines, including Assurance, Advisory, Tax and Transaction Advisory Services. As a result, our professionals are instilled with confidence not only to focus on the issues that matter to you, but to be the first to address those issues with you. Through our Financial Accounting Advisory Services, we can provide assistance on many of your current critical issues, implementation of new accounting standards, accounting experience during financial due diligence, accounting control or process support and assistance with public offerings.

Through our commitment to thinking and being progressive, we strive to meet your needs as the global markets and your company continue to change, as do the issues most important to you.


Our network of dedicated indirect tax professionals combines technical knowledge with industry understanding and access to technologically advanced tools and methodologies.
We identify risk areas and sustainable planning opportunities for indirect taxes throughout the tax life cycle, helping you meet your compliance obligations and your business goals around the world. Our globally integrated teams give you the perspective and support you need to manage indirect taxes effectively.

Taxes Payable
Company/Corporate tax: For companies (other than mining companies) and retirement funds – 30%.
For mining companies – calculated according to the following formula

70 – 1500/X

where X is the number of percentage points represented by the ratio of the chargeable income to the gross revenue of the company.
If the rate of tax calculated above exceeds 45%, then the rate of tax shall be 45% and if the rate of tax calculated above is less than 25%, then the rate of tax shall be 25%.

Capital gains tax: Capital gains are added to the income from all other sources and taxed at the rate applicable to that person.

Branch profits tax: Taxed at the rate applicable to the head office of the branch. In addition a branch of a foreign company is taxed on the repatriated income at the rate of 15%.

Value added tax: The standard rate is 18%.
Fringe benefits tax: Not applicable in Uganda but perquisites to employees are valued as per rules of valuation under the Income Tax Act, 1997 and added to the employment income to determine the tax.

Local taxes: Graduated tax levied by local authorities on individuals above 18 years of the age resident within their jurisdiction was suspended with effect from 1st July 2005. Re-introduced in a another form.

Other taxes: Excise, import and custom duties are applicable on several items either on ad volarem basis or at specific rates.
Determination of taxable income
Capital allowances: Industrial building allowance – 5% on straight line basis.
Initial allowance – 50% or 75% of the cost of eligible property in the first year of use.
Mining allowance – 100% of capital expenditure incurred on searching for, discovering and testing or winning access to deposits of minerals in Uganda.
Horticulture business – 20% on straight line basis of the capital expenditure incurred on the acquisition or establishment of a horticultural plant or the construction of a greenhouse. Depreciation: Allowable on written down value basis at the following rates:

Class of asset
Description of asset
Computers and data handling equipments
Automobiles, buses and minibuses with a seating capacity of less than 30 passengers, goods vehicles with a load capacity of less than 7 tones, construction and earth-moving equipment
Buses with a seating capacity of 30 or more passengers, goods vehicles designed to carry or pull loads of 7 tones or more; specialised trucks, tractors, trailers and trailer-mounted containers, plant and machinery used in farming, manufacturing or mining operations 
Railroad cars, locomotives and equipment, vessels,barges, tugs and similar water transportation equipment,aircraft, specialised public utility plant, equipment and machinery, office furniture, fixtures and equipment, any depreciable asset not included in another group
Stock/inventory: A deduction is allowed for the cost of trading stock disposed of during a year of income. The closing value of trading stock is the lower of cost or market value of trading stock on hand at the end of the year.

Capital gains and losses: Capital gains or losses are taxable only if the asset on which the gain or loss arises is owned by a business and is a non-depreciable asset. This is determined by subtracting from the consideration received on sale of the asset, the cost base of the asset.
Cost base of the asset is the original cost to the taxpayer as increased by any expenditure incurred to alter or improve the asset which has not been allowed as a deduction. In case of immovable property purchased prior to 31st March 1998, the taxpayer may substitute the market value of the property as on 31st March 1998 for the original cost of the asset.
Capital gains and losses are added or subtracted from the other income of the taxpayer for that year of income and not taxed separately.

Dividends: Dividends are subject to 15% withholding tax except dividends paid by companies listed on the stock exchange to resident individuals which is 10%.

Interest deductions: Allowable in full except where a foreign-controlled resident company which is not a financial institution has a foreign debt-to-equity ratio in excess of 2 to 1 at any time during a year of income, a deduction is disallowed for the interest paid by the company during the year on that part of the debt which exceeds the 2 to 1 ratio.

Losses: Assessed losses are allowed to be carried forward and allowed as a deduction in determining the taxpayer’s chargeable income in the following year of income. These are allowed to be carried forward indefinitely.

Foreign sourced income: The gross income of a resident person includes income derived from all geographic sources and the gross income of a non-resident includes only income derived from sources in Uganda.
Foreign tax relief
A resident tax payer is entitled to a credit for any foreign income tax paid by the taxpayer in respect of foreign-source income included in the gross income of the taxpayer.
Related party transactions
No specific restrictions, but under the anti-avoidance section, the Commissioner may distribute, apportion or allocate income, deductions or credits between the taxpayers for any transaction between associates, as is necessary to reflect the chargeable income the taxpayers would have realised in an arm’s length transaction.
Withholding tax

Withholding tax is a final tax on:
(i)         Interest paid by a financial institution to a resident individual
(ii)        Interest paid to any person on treasury bills by the Bank of Uganda
(iii)       Dividends paid to a resident individual
Rates of withholding tax are as under:
Resident         Non-resident
Management fees & royalties          Nil        15%
Consultancy, Agency fees etc.        6%      15%
Professional fees*    6%      15%
Dividends**    15% or 10%   15%
Interest***       15%    15%
Artists and public entertainers         Nil        15%

  Residents Non-residents
Management fees & royalties Nil 15%
Consultancy, Agency fees etc. 6% 15%
Professional fees* 6% 15%
Dividends** 15% or 10% 15%
Artists and public entertainers Nil 15%

*           For residents applicable only if the professional is not registered for VAT
**         Does not apply where the dividend income is exempt from tax in the hands of a shareholder
***       Does not apply to:     Interest paid to a natural person
Interest paid to a financial institution
Besides the above, withholding tax is also applicable and charged on import of goods at the rate of 6%. In case of local transactions of goods and services, 6% withholding tax is applicable where the payer is the Government or government body.

Exchange control

There are no restrictions on foreign currency flows in and out of the country. Realised exchange gains and losses are taxable/allowable in the year of realisation.

Personal tax

Income upto Ushs. 1,560,000 per annum is exempt from tax. The maximum marginal rate of personal tax is 30%.

1.Pay As You Earn (PAYE)

Please find below a summary of the important payroll tax issued. PAYE tax deducted is paid to the Commissioner Domestic Direct Taxes 15 days after the end of the month to which the deductions relates. Employment income means any income derived by an employee from any employment and includes the following amounts, whether of revenue or capital nature; any wages, salary; leave pay, payment in lieu of leave, overtime pay, fees, commission, gratuity, onus or the amount of any traveling, entertainment, utilities, cost of living, disturbance allowance or any other allowance.

The value of any benefits in kind granted to an employee also construes a taxable benefit and    these     include but not exclusively the following:-

Housing allowance
The full amount of housing allowance is taxable on the recipient. If an employer provides to an employee accommodation or housing other than house allowances, the taxable benefit on the employee is the lesser of:-

the market rent of the accommodation or housing reduced by any payment made by the employee for the benefit; or fifteen per cent (15%) of the employment income, including the amount referred to in (a) above paid by the employer to the employee for the period in which the accommodation or housing was provided.

Please note that costs incurred by employers to house their employees are now tax deductible in the tax computation of the employer company.

Taxable benefits
Housekeeper, chauffeur, or other domestic assistants

The value of the benefit is the total employment income paid to the domestic assistants in respect of the services rendered to the employee, reduced by any payment made by the employee for the benefit.

Provision of utilities in respect of the employee’s residenceThe value of the benefit is the cost to the employer of providing the utilities reduced by any consideration paid by the employee for the utilities.

More of Others
The value of the benefit for providing the following benefits is the cost to the employer for providing them. Telephone – this should be apportioned between private and official use and the employee taxed on private use.

1.School fees for children
3.Security services
4.Other household maintenance costs.
5.Furniture benefit

The law is silent on the taxation of furniture benefit.  In principle, the employee is taxed on the market value of the furniture in the month the furniture is provided.

Uganda Revenue Authority, (URA) is yet to issue a departmental practice regarding the taxation of furniture benefit.

Staff Welfare
If the employees are provided with meals, refreshment, or entertainment, the value of the benefit is the cost to the employer of providing the meals, refreshment or entertainment.

However, the value of meals or refreshments provided by the employer to its employees is not a taxable benefit on the employees if the meals or refreshments are provided to the employees in premises operated by the employer and the benefit is available to its full time employees on equal terms.


Payment of mileage to employees for use of personal vehicles on business is tax free so long as it is reasonable and considered as a reimbursement of costs incurred or to be incurred on business duties.  The mileage scheme of the company has to be formally approved by Uganda Revenue Authority.


Loans to staff at favorable rates of interest are not tax efficient.  The difference between the interest rate on the staff loan and what would be the interest rate at the Bank of Uganda discount rate at 1st July of each year, a taxable benefit to the staff.

Waiver of any obligation
The value of a waiver by an employer of an obligation of the employee to pay or repay an amount owing to the employer or to any other person is a taxable benefit.

Transfer, use of property or provision of service
The market value of the use of property or the provision of services reduced by any payment made by the employee for the property or services are a taxable benefit.

All gratuity payments for termination of contracts of employment are taxed in the month the payment is made.

In case of payment for termination of employment where the employee has been in employment for ten years or more only 75% of the amount paid is to be taxed.

Motor Vehicles
For employees provided with company vehicle and the vehicles are available for the private use of the employee, a taxable motor vehicle benefit arises on the employee.  The benefit is calculated as follows: (20% x A x B/C – D), where;

A  - Market value of the vehicle when first provided for use to the employee.
B  - Number of days in the year the vehicle was available for private use.
C  - Number of days in the year of income.
D  - Any payment made by the employee for the benefit.

Medical expenses
Any reimbursement or discharge of the employee’s medical expenses are not part of employment income but medical cash allowance paid to the employees are deemed employment income by URA.  Employee’s medical expenses also include premiums or other amounts paid for medical insurance.
The exemption also covers medical services provided to the employee’s spouse and four dependants under the age of 18.

Permanent employees should be registered with N.S.S.F unless exemption is obtained for reasons that the employees are covered under any other approved pension scheme.  N.S.S.F is calculated at 15% of the employee’s employment income.  5% is deducted from the employee’s salary and 10% contributed by the employer.  Employee’s contributions to N.S.S.F are no longer deductible before calculating PAYE with effect from 1 July 2001.

Staff Uniform
The cost of staff uniform to the extent that the uniform is not suitable for wearing outside of work, is not a taxable benefit to the employee.

Cost of Air tickets
The cost of a private air ticket is not taxed on the employee if;
a)         the travel is in respect of appointment or termination of employment,
b)         if the employee:-

was recruited or engaged outside Uganda,
is solely in Uganda for the purpose of serving the company; and
is not a citizen of Uganda.
In light of the above, it is important to note that expenses incurred by or on behalf of its employees, which are domestic or private nature are taxable on the employees for PAYE purposes.

2. Corporation Tax

Initial Allowance on Industrial Buildings
Please note that if company places a new industrial building in service for the first time during the year of income, it will be entitled to initial allowance of 20% of the cost base of the building at the time it is placed in service.

This deduction applies to industrial buildings, which were constructed on or after 1 July 2000.  Industrial buildings are defined as any building, which is wholly, or partly used, or held ready for use, by a person in manufacturing operations.  In practice this excludes the office/administration block, guesthouses, staff house and the clubhouse. The company-refurbished structures qualify for the 20% initial allowance.

What is tax Withholding

Withholding tax is a form of Income Tax. This tax is deducted at source by one person upon effecting payment to another person.
The law specifies the persons who are required to withhold tax as well as those upon whom the tax should be imposed.

For ease of understanding, withholding tax is discussed in the following three broad categories:
Withholding tax on employment income
Withholding tax on gross payments/earnings other than employment earnings
Withholding tax on imports.

Withholiding tax employment income 116
This tax is deducted by the employer from the employment earnings of every liable employee on a monthly basis under the system of Pay As You Earn.

Withholding tax on international Payments (Section 83)
Tax is imposed on every non-resident person who derives any dividend, interest, royalty, natural resource payment or management charge from sources from Uganda.  The rate of charge is 15% (Section 120).

However, interest paid abroad by a resident person in respect of debentures which were issued by a foreign company for purposes of raising loan capital to carry out business in Uganda is exempt.
Withholding tax on payment to Public Entertainer and Sports Person (Section 84)

Tax is imposed on every non-resident public entertainer or sports person who derives income from any performance in Uganda.  The tax is charged at 15% of the gross amount of the remuneration derived by a public entertainer/sports person or receipts derived by any theatrical, musical or other group of public entertainers/sports persons.  The obligation to withholding the tax is placed with the person making the payment e.g. Promoter, agent, or such similar person (S.120).

Who we are

Audit and Assurance
Project Planning and Management
Our Audit Methodology
Fraud Investigation & Dispute Services
Our Team

Quality control standards
Audit Procedures Manual
Comprehensive audit procedures manuals are used in FCK. The use of standardised audit procedures ensures that work is carried out in accordance with the outlined standards
Continuing Professional Education
FCK & Associates quality control standards stipulate that all staff under the supervision of the technical and training partner, a pertinent CPE programme. In addition to meeting the CPE standards of the firm, the programme is required to comply with the requirements of professional bodies. CPE is provided to all staff by participation in regional conferences and seminars. In addition, strict supervision of staff at the field level ensures that adequate, on the field training, is provided to staff on a continuous basis.

Staff involved in industry specific audits is required to undergo rigorous training to ensure that they are proficient with the operations, risks, legislation and regulations governing these industries. In addition to the audit manual, we have developed comprehensive audit and procedures manuals for industry specific audits in high risk sectors such as banking and insurance.
Peer Review
FCK & Associates technical and quality control team conducts reviews internally on a quarterly basis. The review includes formal reporting on the system of quality control in operation, and a detailed analysis on the results of the review including any emerging best practices that may be replicated.
Skills Transfer Programme
FCK & Associates encourages staff training programs, skills workshops and seminars internally, both on a formal and informal basis to help maintain international standards of work.