Tag Archives: news

Money Lending Regulation: Key Insights for Lenders and Borrowers

Institutions or money lenders are now under a mandatory obligation to allow borrowers at least five working days after signing a lending contract, to revoke or terminate the contract by written notice delivered to the institution or money lender.

The revocation termination is effective if the borrower repays the full amount of the loan at the time of cancellation of the contract and any other administrative charges, or fees which have been reasonably incurred in arranging the loan and these must not exceed two percent of the value of the loan.

Brand Marketing and Advertising Services in Cross Border Trade; Where and How does consumption Occur for VAT Purposes?

Marketing and advertising services aim to build brand goodwill, which is an intangible asset tied to specific territories. It is obvious that brand visibility and consumer engagement occur within the market targeted by the advertisements and brand marketing, in this case, Uganda.

Goodwill, in law, is territorial and can be quantified financially but this is tied down to the territory in which the reporting entity operates because again in law, goodwill only exists with the existence of trading activities in a particular market. 

This means the economic benefit sought when buying marketing services is goodwill enhancement. This economic benefit is therefore realized in the market where goodwill is enhanced as a result of the brand marketing and advertising targeting that market. In this case Uganda and most certainly not in the United States.

DISPOSAL OF REAL ESTATE ASSETS; WHEN DO WITHHOLDING TAX OBLIGATIONS ARISE?

Withholding tax on real estate transactions is advance capital gains tax on the disposal of ”business assets”. And in turn, Capital gains tax is a subcategory of business income under the Income tax Act. And finally if a transaction does not amount to a trading transaction, withholding tax under business income does not arise because the proceeds of the sale are not received as taxable income.

Taxation of Interest Income from Fixed Deposit Bank Accounts: Compliance Obligations and Related Matters.

The commercial advantages of being exempt include better cash flow and working capital management; Exempt businesses easily avoid financial distress by taking some relief from the harshness of having to pay tax before it’s due; that is to say, before the obligation to file a final return and account for income tax, arises; which for non-individuals is 6 months after the end of the tax year. 

Webinar Invite: Overview of the Uganda Budget Highlights, 2024

Join us for an engaging and informative webinar where the MRT Tax and RSM Eastern Africa team will break down the Uganda Budget Highlights for 2024 and their tax and commercial implications to businesses.

NAVIGATING THE NEW TAX YEAR 2024-2025: KEY CONSIDERATIONS FOR BUSINESSES.

Enhanced focus on digital transactions

With the digital economy growing rapidly, tax authorities worldwide, including the URA, are paying more attention to digital transactions. E-commerce, digital services, and online marketplaces are becoming significant contributors to the economy, and they are now firmly on the tax radar. Businesses engaging in digital transactions should ensure they understand the tax implications and comply with the relevant digital services tax regime recently introduced under the VAT Act and the Income Tax Act.

A GOVERNMENT CONTRACTOR’S GUIDE TO DEEMED VAT.

Deemed paid VAT is a tax relief mechanism by which the government absolves a VAT trader from payment of the VAT charged by their customer on a VAT taxable transaction.

The deemed paid VAT relief is a commercially advantageous incentive that greatly improves cash flow resilience of businesses in the commercial chain of expensive infrastructure projects as well as those in capital intensive sectors owing to the fact that most often, these businesses must mobilise large amounts of capital from lenders or internally(shareholders) in order to be able meet the financing needs of executing such capital intensive projects. For this reason, it is therefore critical for taxpayers that fall under this category to properly grasp the deemed paid VAT principle and to understand its applicability and the commercial implications of this relief to their operations.