July 2023: extension of scope of services subject to VAT
Uganda’s VAT has been amended to extend the scope of digital services subject to VAT – THE VALUE ADDED TAX (AMENDMENT) ACT, 2023. Non-resident e-service providers have been liable to charge and collect VAT for some years.
The changes include addition of online auction services (not just goods sold online by auction). Plus new definition of all “electronic services” means services supplied through an online or digital network by a supplier from a place of business outside Uganda to a recipient in Uganda including-
(i) websites, web-hosting or remote maintenance of programs and equipment;
(ii) software and the updating of software;
(iii) images, text and information;
(iv) access to databases;
(v) music, films and games; including games of chance;
(vi) political, cultural, artistic, sporting, scientific and other broadcasts and events; including television;
(vii) advertising platforms;
(viii) streaming platforms and subscription based services;
(ix) cab-hailingservices; (x) cloud storage; and (xi) data ware housing.”
April 2023 – proposal to extend VAT on non-resident providers of digital services
The Ugandan Finance Ministry has proposed (Tax Amendment Bills 2023) extending the July 2022 existing VAT liabilities on non-resident marketplaces. This would involve shifting the place of supply to Uganda. There will be a VAT registration threshold of UGX 150m. There will be no requirement for a local VAT representative.
The Bill extends the ranges of platforms liable to VAT (scroll down for current list of taxable supplies). The new proposed additions are:
- advertising platforms;
- streaming platforms and subscription-based services;
- cab-hailing services;
- cloud storage; and
- data warehousing.
In addition, it is proposed that non-resident providers of digital services with a VAT registration will be allowed to remit taxes due in US dollars.
July 2022 – Non-resident e-service providers confirmed liable to VAT 1 July 2022; provided with new registration and returns portal
The URA has confirmed that non-residents should now be register and reporting VAT on sales to Ugandan consumers. The Uganda Revenue Authority was originally given powers to impost VAT on non-residents in 2011, but did not do due to legal uncertainties.
New registrations portal
Foreign platforms may now use the Uganda Revenue Authority‘s new online portal to register and report quarterly VAT returns. This includes first applying for a Tax Identification Number with the URA. The option to appoint a local fiscal representative still applies.
Uganda confirmed the VAT obligations for non-resident platforms of B2C electronic or digital services from July 2018. This includes the obligation to VAT register once over the threshold of UGX 150m, but no requirement to appoint a fiscal representative.
The current VAT rate in Uganda is 18%. VAT Calc’s global VAT and GST on digital services blog keeps a live update on how countries are imposing indirect taxes on non-resident providers and electronic marketplaces.
What digital services are taxable in Uganda?
Income from the supply of the following digital services supplied remotely is subject to Ugandan VAT:
- SaaS and cloud software
- Website domain name and hosting
- Images and data
- E-learning
- Online gaming and gambling
- Online advertising
- Streaming media (music, TV and films)
- Television broadcast
VAT registrations and compliance
Non-residents are obligated to VAT register if their quarterly income exceeds UGX 37.5m (approx €9,000) or their annual income exceeds UGX 150m (approx €36,000). There is no requirement for a foreign provider to appoint a local Fiscal Representative. However, the practicalities of the process generally mean an agent is necessary who will be jointly and severally liable for the VAT.
VAT returns are then due on a monthly basis. They should be filed, along with the remittance of any VAT due, by the 15thof the following month.
Africa & Middle East VAT on digital services
| Comments (click for details) | Rate | Date | Threshold | Comments |
| Algeria | 9% | Jan 2020 | Nil | |
| Angola | 14% | Oct 2019 | – | |
| Bahrain | 10% | Jan 2019 | Nil | |
| Benin | 18% | Oct 2023 | TBC | |
| Botswana | 14% | 2024 | - | Pending implementation |
| Cameroon | 19.5% | Jan 2020 | XAF 50 million | |
| Cape Verde | 15% | Jan 2022 | Nil | |
| Congo, Democratic Republic | 16% | Jan 2024 | - | |
| Egypt | 14% | Sep 2016 | EGP 500,000 | |
| Ghana | 12.5% | Apr 2022 | GHS 200,000 | |
| Israel | 17% | TBC | – | Proposals withdrawn |
| Ivory Coast | 18% | 2022 | - | |
| Jordan | 16% | JOD 30,000 | ||
| Kenya | 16% | Sep 2013 | - | Registration threshold removed 2023 |
| Kuwait | 5% | Jan 2024? | - | TBC |
| Mauritius | 15% | 2020 | ||
| Morocco | 20% | 2024 | ||
| Mozambique | 16% | 2017 | Nil | |
| Nigeria | 7.5% | Jan 2020 | $25,000 | |
| Oman | 5% | Apr 2021 | OMR 35,000 | |
| Rwanda | 18% | TBC | ||
| Saudi Arabia | 15% | Jan 2018 | Nil | |
| Senegal | 18% | Apr 2024 | Nil | Fiscal representative required |
| Sierra Leone | 15% | Jan 2021 | SLE 100,000 | No non-resident rules |
| South Africa | 15% | Jun 2014 | ZAR 1 million | |
| Tanzania | 18% | Jul 2022 | Nil | Residents since Jul 2015 |
| Tunisia | 19% | Jan 2020 | Nil | Withholding VAT; 3% Royalty Tax |
| Uganda | 18% | Jan 2020 | UGX 150m | |
| United Arab Emirates | 5% | Jan 2018 | AED 375,000 | |
| Zimbabwe | 14.5% | Jan 2020 | Nil | |
| Zambia | 16% | Jan 2024 | Fiscal Representative req'd |
