Tax Refund

Refund is a repayment, reimbursement, or compensation.

  • A tax refund is the difference between taxes paid and taxes owed. This may be as a result of taxes paid in error or in excess of tax assessed or due.
  • This is a process where a taxpayer claims money that was over paid to URA as tax.
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– ALL COMPLIANT TAXPAYERS.
– Claims as a result of a decision of High court, TAT or Court of appeal

• When input tax is greater than output tax
• When a tax payer pays more than what is supposed to be paid.
• When there is proven bad debt;
o Should have been outstanding for at least 2 years and
o Secondly, necessary steps should have been taken to recover the money to no vial
• When one loses the stock through fire, burglary and any other proven methods
• VAT refund to privileged persons. e.g diplomats and diplomatic missions. These must show proof of VAT paid and each individual expenditure should be exceeding 50,000.

The refund in case of monthly return is paid within thirty (30) days beyond which interest accrues.

• When the tax payer has paid taxes exceeding his tax liability.
• Where his provisional tax paid is greater than the final tax assessed.
• Where the withholding tax paid is greater than his tax liability.

Duly filled and signed Tax Refunds Return Form– DT – 2031. A taxpayer can only request for a refund if the amount is above 5 million Uganda shillings.

Please Note:
A VAT refund can be claimed through a provision included on the VAT return form.
1. Where URA has delayed to process your tax refund without any justification, you are entitled to an interest on the refund amount of 2% per month simple interest for VAT. This commences from the end of the 30 working days during which the refund is processed.
2. You must tick cash refund on the VAT form to claim the refund.
3. A refund audit will be conducted if you are a first time applicant;
4. If you are in a cash refundable position, the money will be deposited onto the declared bank account declared in URA;
5. A person may claim a refund for the output tax paid in excess of the amount tax due for a tax period. This may arise as a result of :-
a) A taxable person’s input tax credit exceeding his or her output tax for that period, where he or she applies for a VAT refund through the monthly return
b) An objection decision
c) A decision of Tax Appeals Tribunal or High Court.
d) Loss of Goods in Stock, CG may grant a refund for the input tax paid on such goods.
e) Bad Debts, subject to S.43 (1)
f) Export / Zero rated goods
g) Purchases By Diplomats/diplomatic missions and international organizations.
However, where the amount of the excess input tax credit is less than 5 million, except for persons mainly dealing in zero rated supplies, CG shall offset that amount against the future liability of the taxable person.
The claim shall be made in a return within three years after the end of the tax period in which the tax was over paid.

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