What is Withholding Tax?
Tax withholding, also known as tax retention, Pay-as-You-Go, Pay-as-You-Earn, Tax deduction at source or a Prélèvement à la source,
is income tax paid to the government by the payer of the income rather than by the recipient of the income. The tax is thus withheld or deducted from the income due to the recipient.
How To Calculate 6 Withholding Tax In Uganda
Withholding taxes (WHTs)The WHT is at a rate of 15%. However, individuals are not obligated to withhold tax on payments made by them to taxable persons.
WHT is also incurred at a rate of 15% on dividends received by individuals. However, if the dividend is received from a listed company, the WHT incurred is 10%.
Who is eligible to pay withholding tax in Uganda?
According to Section 83(1) of the ITA, a tax is imposed on every non-resident person who derives any dividend, interest, royalty, rent, natural resource payment, or management charge from sources in Uganda.