Housing Baraza: URA says it has encountered difficulties in locating rental income taxpayers

The Uganda Revenue Authority (URA) Commissioner Domestic Taxes, Sarah Chelangat has revealed that the tax body is still facing a lot of difficulties in locating most rental income taxpayers.

In 2021, URA said that the rental income tax segment continues to see a lot of non-compliance with only 8%  of landlords in the country fully remitting what is due in taxes.

Speaking during the official opening of the NBS Housing Baraza at the Next Conference Centre in Naguru, Chelangat assured something is being done to solve the problem at once.

"We are not getting rental tax because we cannot locate most of these people (owners of commercial buildings) but are working towards it. We are working with technology companies and using our technology to locate property. There are many unmarked buildings," she said.

The tax body indicated that it was aware that at least 88 high income landlords who own close to 285 properties in Greater Kampala don’t pay rental income tax.

 This, she said, prompted the taxman to deploy the rental tax compliance system in a pilot project as a preparatory measure to close leakages in the rental income tax segment.

The software-based system sought to enhance tax compliance and would be important in determining priority for individuals or corporations that are likely to underpay rental income tax.

"Taxes around the housing project are very key. It is a very important sector; I don’t think we have got maximum out of it but we are on it. If we are able to locate these buildings, we are able to locate these owners, this will be very good for tax administration and for policy makers," she said.

She said that they will be using electronic fiscal receipt and invoicing solutions which will help to trace the owners of some of these buildings in the city.

She said there is a lot of fraud around the actual declaration of the rent paid, especially the commercial property downtown.

"All those arcades are owned by people who are paying 20% of what would be the actual rate. These are things that really make our tax collection very difficult but we are engaging and investigating. We are asking Ugandans to be patriotic in paying taxes," she stated.