How To Calculate Vat In Uganda

What is Value Added Tax?

A value-added tax, known in some countries as a goods and services tax, is a type of tax that is assessed incrementally.

It is levied on the price of a product or service at each stage of production, distribution, or sale to the end consumer.

How To Calculate Vat In Uganda

Below is how vat is calculated in Uganda

The basic formula to calculate financial value added for a product or service is:

Value added = Selling price of a product or service − the cost to produce the product or service.

GVA = GDP + SP – TP.


MVA = V − K.

CVA = Gross cash flow − economic depreciation − capital charge.

What is VAT inclusive formula?

Calculating the VAT Amount

So to calculate the VAT on any purchase price, we need to multiply the price by the VAT percentage. For a purchase price of x, we multiply x by 15%.

But recall that 15% means 15 per 100 or 15/100. So the VAT amount on x is simply x multiplied by 15/100 = (x)(15/100).

How do you add 20% VAT to a number?

You do this by taking your VAT rate, divide by 100 then add 1. An example of this using a 20% VAT rate would be 20/100 = 0.2 + 1 = VAT fraction OF 1.2.

A further example for 17.5% would be 17.5/100 + 1 = VAT fraction of 1.175.

What Is The VAT Percentage In Uganda?

VAT rates for goods and services

Standard rate20%Most goods and services
Reduced rate5%Some goods and services, eg children’s car seats and home energy
Zero rate0%Zero-rated goods and services, eg most food and children’s clothes

How Do I Calculate VAT Sales In Uganda?

Below is how vat sales is calculated in Uganda

  1. Vatable Sales = Total Sales/ 1.12.
  2. VAT = Vatable Sales x 1.12.
  3. Total Sales = Vatable Sales + VAT.

What Items Are VAT Exempt In Uganda?

A business is VAT-exempt if they only sell VAT-exempt products, or if they’re not involved with taxable ‘business activities’.
VAT exemption for goods and services

Sporting activities and physical education.

Education and training.

Some medical treatments.

Financial services, insurance and investments.

How Is VAT Charged In Uganda?

Value-added tax (VAT) VAT is governed by the VAT Act and administered by the Uganda Revenue Authority (URA). 

VAT is charged at the rate of 18% on the supply of most goods and services in the course of business in Uganda. Specified goods and services, as well as exports outside of Uganda, attract a zero rate of tax.