How To Calculate Paye In Uganda

What is Paye?

A pay-as-you-earn tax, or pay-as-you-go, is a withholding of taxes on income payments to employees.

Amounts withheld are treated as advance payments of income tax due. They are refundable to the extent they exceed tax as determined on tax returns.

How To Calculate Paye In Uganda

Wondering how much money you are supposed to pay or will pay in form of income taxes in Uganda? How about knowing if you qualify for Pay As You Earn yet or not? Reading this article will help you right from understand your tax obligations to the government, know whether your current income is taxable, and how much you are supposed to pay as PAYE, and also help you find answers to your questions related.

In Uganda, people whose gross income is at a certain level are liable to pay PAYE. This is because it is another source of government income collected from people in the formal and informal sectors. This money is collected by Uganda Revenue Authority, the government body, and the entity that handles everything to do with taxes.

Do you qualify for Pay as you earn? If you earn more than the below incomes at gross, and regardless of whether you are a resident or non-resident, the answer is YES. The better way to find out is either doing it yourself or using a third-party professional to help you find out and or calculate the much you are supposed to pay.

How to calculate PAYE by yourself?

The answer to this question is simple. Now that you have seen the amount which makes you qualify, just use dive the rate by your gross income eg if you are at 10%, a resident, and earning 300,000, it should be 10/100×300000. The answer you get is the amount you are entitled to pay. You can also use the free online PAYE Uganda calculators available eg for the same or even visit the URA brand office. Please note that these rates are subject to change. The current rate is quoted at the time of publication.

How much PAYE should I pay in Uganda?

Resident individuals enjoy a tax-free annual income threshold of UGX. 2,820,000 per annum. The balance is taxed at 10%, 20%, or 30% depending on the income bracket.

Individuals who earn above UGX 120,000,000 pa pay an additional 10% on the income above 120m.

At what percentage is PAYE calculated?

If one spends 20% of the allowance on business trips, 80% will be subject to PAYE deductions.

Meanwhile, if the person travels 80% of their working time for official duties, 20% of their travel allowance is taxable.