Livestock Farming

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All livestock farmers in Uganda are required to be registered with;

  • Uganda Registration Services Bureau (URSB) for Company registration or a Certificate of registration if you’re an individual.
  • Uganda Revenue Authority (URA) for taxes

Please note:

Upon registration, the farmer is required to comply with the requirements of statutory bodies like

Department of animal resources in the Ministry of Agriculture, animal industry and fisheries.

For individual

  • National ID or any other two of the following valid identification documents;  Passport, Driving permit, Voter’s card, Village ID, Employment ID, Refugee ID, recent Bank statement, Work permit, financial card, Visa, NSSF card etc.
  • Certificate of registration (incase you are in business)
  • Statement of particulars and partnership deeds (incase of a partnership)

For non-individual

  • Company Form 20
  • Certificate of incorporation

Click here for details on requirements for registration of your livestock business

 

 

 

 

Click here for your rights  as a taxpayer

Click here for your  obligations as a taxpayer

 

 

A livestock farmer has to keep records relating to all business transactions. It is important to always have records that are dated so that you can understand which reports relate to what period. These include;

  • Income statement records
  • List of receipts and payments
  • Balance sheet
  • Payroll for your employees
  • Import schedules
  • Contracts
  • Bank statements
  • Appointment letters
  • Utility bills
  • Stock records
  • Asset registers
  • Invoices
  • Debtors and Creditors

 

It is very important for a livestock farmer to;

  • keep proper records of all business transactions in the English language. Where a record is not in English, the taxpayer will be required to meet the cost of translation into English by a translator approved by the Commissioner
  • keep records such that it is easy to determine their tax liability;
  • keep records for five years after the end of the tax period to which they relate for future reference.
  • In case a record is necessary for a proceeding that started before the end of the 5-year period, a taxpayer shall keep the record until the end of the proceedings.
  • The records kept should contain sufficient transaction information and should be saved in a format that is capable of being recovered and converted to a standard understandable record format.
  • A taxpayer who wishes to keep records in a different language or currency shall apply in writing with clear reasons to the commissioner for permission.

Any person dealing in commercial agriculture business is required to register for income tax. Income tax applies generally to all types of persons who derive income, whether an individual, non-individual or partnership.

Corporation tax

This is tax imposed on all companies in Uganda at a standard rate of 30%. A livestock farmer must register for this tax.

Rate of tax for Resident individuals

ANNUAL CHARGEABLE INCOME (CYIN UGX

RATE OF TAX

0 to 2,820,000

Nil

2,820,000 to 4,020,000

(CY – 2,820,000UGX) x 10%

4,020,000 to 4,920,000

(CY – 4,020,000UGX) x 20% + 120,000UGX

4,920,000 to 120,000,000

(CY – 4,920,000UGX) x 30% + 300,000UGX

Above 120,000,000

[(CY – 4,920,000UGX) x 30% + 300,000UGX] + [(CY – 120,000,000UGX) x 10%]

Rate of tax for Non-Resident individuals 

ANNUAL CHARGEABLE INCOME (CYIN UGX

RATE OF TAX

0 to 4,020,000

CY x 10%

4,020,000 to 4,920,000

(CY – 4,020,000UGX) x 20% + 402,000UGX

4,920,000 to 120,000,000

(CY – 4,920,000UGX) x 30% + 582,000UGX

Above 120,000,000

[(CY – 4,920,000UGX) x 30% + 582,000UGX] +[(CY – 120,000,000UGX) x 10%]

Withholding tax (WHT) at importation

This is income tax withheld at importation of a good. It is at a rate of 6% of customs value (WHT = Customs value x 6%).

If a livestock farmer chooses to import supplies exceeding UGX 1,000,000, it is required to charge withholding tax at a rate of 6% which is later remitted to URA.

It can be used to clear part of the tax payable by the farmer when filing the final income tax return.

Note. If the importer is exempted from WHT, he/she should not be charged this tax at importation

Click here for more information on Withholding tax.

Since a livestock farmer deals in exempt supplies, there is no requirement to register for VAT.

However, if you’re a commercial livestock farmer, you can register for VAT using the voluntary registration window and this can enable you to claim for your input VAT (VAT on purchases).

Please note: You are required to pay for import VAT for agricultural inputs that are standard rated.

Click here for more information on VAT

Import duty

This is a tax imposed on imports and some exports not listed in the exemption

schedule by URA. It is based on the customs value of the goods that are imported.

If a livestock farmer chooses to import you should pay import duty  on items imported.

Click here for more information on import duty rates.

 Pay As You Earn (PAYE)

Any livestock farmer with workers/employees earning a monthly salary more than 235,000 UGX per month is required to register for Pay As You Earn (PAYE), withhold and remit tax to URA.

Click here for the PAYE rates

Click here for information on how to file your returns.

 

After filing a return, you’re required to pay taxes due using available payment platforms e.g. banks, mobile money, VISA, Mastercard etc.

Please note: the due date for payment of tax is the same as that of return filing.

Click here to register a payment

 

 

Description

Tax incentive

Agricultural sprayers

  • VAT Exempted when imported by dealers under the VAT Act.
  •  Exempted from all taxes when imported by persons engaged in agriculture under the 5th Schedule of the East African Community Customs Management Act, 2004.

Refrigerated Trucks

  • Exempted from all taxes under the fifth schedule of the East African Community
  • Customs Management Act, 2004.

Agricultural–Chemicals (fungicides and pesticides)

  • VAT Exempted when imported by dealers under the VAT Act.
  • Exempt from all taxes when imported by persons engaged in agriculture under the 5th Schedule of the East African Community Customs Management Act, 2004.ed

Veterinary Chemicals (Acaricides)

  • VAT Exempted when imported by dealers under the VAT Act.
  • Exempted from all taxes when imported by persons engaged in agriculture under the 5th Schedule of the East African Community Customs Management Act, 2004.

Aluminum Cans for the dairy industry

  • Exempted from all taxes under the fifth schedule of the East African Community Customs Management Act, 2004.

Heat Insulated Milk tanks for the dairy industry

  • Exempted from all taxes under the fifth schedule of the East African Community Customs Management Act, 2004.

Insulated tankers

 

  • Exempted from all taxes under the fifth schedule of the East African Community Customs Management Act, 2004.

Cold Rooms; a cold a room in which a low temperature is maintained (as for refrigeration)

  • Import Duty is 0% in accordance with the EAC CET. Helps on post-harvest management and cold chain storage of agricultural products such beef, chicken, fish etc

Breeding animals. Breeding stock is a group of animals used for the purpose of planned breeding

  • VAT Exempted when imported by dealers under the VAT Act.
  • Exempted from all taxes when imported by persons engaged in agriculture under the 5th Schedule of the East African Community Customs Management Act, 2004.

Preparations for cleaning Diary apparatus

Pfanzite is a highly chlorinated, powdered manual cleaner designed especially for cleaning bulk tanks, the Surge bucket milker and utensils.

  • Exempted from all taxes under the fifth schedule of the East African Community Customs Management Act, 2004.

Feeds for livestock

 

  • VAT Exempted when imported by dealers under the VAT Act.
  • Exempted from all taxes when imported by persons engaged in agriculture under the 5th Schedule of the East African Community Customs Management Act, 2004.

Machinery for processing dairy products

  • VAT Exempted when imported by dealers under the VAT Act.
  • Import duty is 0%, under East African Community Common External Tariff VAT Exempted.

Packing material of any kind designed for packaging goods for export

  • Exempted from all taxes when imported with an intention of packaging goods meant for export, 2004.

Nil duty on construction materials of a factory or warehouse exclusive of those available on the local market, locally produced raw materials and inputs.

Beneficiary: Operator within the industrial park, free zone or other business outside the industrial park or free zone who invests in commercial farming.

  • Must invest a minimum of USD 10m for foreign investors and USD 300,000 for EAC citizens or USD 150,000 where the investment is made upcountry.
  • Incentive takes effect from the date of commencement of the specified business, same incentives applies to an existing operator in an Industrial Park or Free Zone.
  • The investor must use at least 70% of locally sourced raw materials and employ at least 70% EAC citizens who must take up at least 70% of the wage bill.

No Stamp duty on debentures, lease of land, Increase of share capital, transfer of land.

Beneficiary: Operator within an industrial park or free zone or an operator of a single factory or other business outside the industrial park who

Invests in commercial farming.

  • Must invest a minimum of USD 10m for foreign investors and USD 300,000 for EAC citizens or USD 150,000 where the investment is made upcountry. Incentive takes effect from the date of commencement of the specified business, same incentives applies to an existing operator in an Industrial Park or Free Zone. The investor must use at least 70% of locally sourced raw materials and employ at least 70% EAC citizens who must take up at least 70% of the wage bill.

 

Click to download the Agricultural Sector Guide
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