The Uganda Revenue Authority (URA) has introduced a cutting-edge tax compliance system aimed at helping taxpayers maintain compliance while avoiding penalties and fines.
As part of its strategy to optimise revenue mobilisation, the Domestic Taxes Compliance Improvement Plan (CIP) for the financial year 2024/25 identifies 20 key areas where taxpayer non-compliance often leads to inaccurate and incomplete returns, which, in turn, triggers penalties.
The CIP is designed to address potential risks posed by taxpayer behaviour that may undermine tax collection efforts. At the heart of this plan is a new initiative known as the “Real-Time Audit,” which enables the URA to examine taxpayer transactions in real time.
Should any irregularities be detected, the taxpayer will be immediately notified with detailed guidance on how to resolve the issue.
Through this new system, taxpayers will receive regular notifications called “Real-Time Tax Advisories” (RTAs), highlighting potential tax implications and providing actionable steps to ensure compliance.
According to URA, this system is beneficial to both the tax body and taxpayers as it minimises exposure to additional taxes, interest, and penalties, while encouraging timely and accurate declarations.
In a statement, URA emphasised that “the advisories are aimed at helping taxpayers reduce their exposure to additional taxes, interest, and penalties by encouraging timely and accurate declarations and tax payments.”
The new system will also facilitate access to crucial URA services, such as obtaining a Tax Clearance Certificate, Authorised Economic Operator status, and tax exemptions.
The CIP highlights several areas where taxpayer behaviour has historically posed challenges to revenue mobilisation.
These include suspicious loans reflected in balance sheets, failure to register for VAT despite eligibility, inaccurate registration details, and discrepancies in Pay As You Earn (PAYE) declarations from Local Governments.
Other concerns involve traders not declaring VAT on imported goods, overstated trade payables, and businesses operating at gross loss positions without proper income tax registration.
To ensure accuracy, URA urges taxpayers to strengthen their internal controls and review these critical areas throughout the year.
With the CIP in full effect, the URA is committed to achieving its ambitious revenue target of She32 trillion for the 2024/25 financial year, a significant increase from the She29.6 trillion target of the previous year, when it fell short by She2 trillion.
According to current data, Uganda Revenue Authority (URA) as well reported an impressive performance for August 2024, with revenue collections surpassing the set target.
The total net revenue for the month stood at She2.345 trillion, exceeding the target of She2.316 trillion by She28.19 billion. This achievement represents a performance rate of 101.22%, signaling a strong start to the fiscal year for the tax body.
In August 2024, domestic revenue collections amounted to She1.492 trillion, surpassing the target of She1.465 trillion by She26.75 billion. On the other hand, customs revenue collections reached She928 billion, outperforming the target of She918 billion by She10.32 billion.
This overall growth marks a 9.96% increase in net revenue compared to August 2023. Specifically, domestic revenue collections saw a growth rate of 11.10%, while customs revenues grew by 10.23%
