PAYE for NGO Project Employees in Uganda

by Claire
(Kampala)

Tax Question
If NGO in Uganda is project based, and projects usually last for one year. Are employees of NGO liable to PAYE and NSSF even if they dont earn a salary but get small allowances?

Answer

According to the Income tax Act cap 340, Employment income includes:
Wages, salary, leave pay, payment in lieu of leave, overtime pay, fees, commission, gratuity, and bonus, allowances (entertainment, duty, utility, welfare, housing, medical, or any other allowances). This means that as long as you’re making any payments to employees they will be subject to PAYE as long as there earnings exceed UGX130, 000. In some circumstances, NGO’s that hire consultants to perform specific services usually withhold the 18% VAT on the contract price for the consultancy services.

Please contact a Certified Uganda Tax Consultant to assist you with tax filling.