In a bid to equip small and medium-sized enterprises (SMEs) with the knowledge needed to navigate Uganda’s evolving tax landscape, Stanbic Business Incubator Limited (SBIL) hosted its September Masterclass, spotlighting the country’s newly introduced tax measures for the 2025/2026 fiscal year.
The session featured Solomon Rukundo, a Tax Specialist from the Ministry of Finance, Planning, and Economic Development, who unpacked the implications of recent tax amendments under the theme: “Navigating Uganda’s FY 2025/2026 Tax Reforms: Strategic Insights for Businesses and Investors.”
Central to the reforms is a three-year tax holiday for start-ups—a move designed to encourage formalisation and ease the entry burden for new businesses. Rukundo noted that to qualify, businesses must be registered after July 1, 2025, operate as sole proprietorships or partnerships, and have a capital investment below UGX 500 million.
“This incentive is designed to reward new formalised businesses, but it is not a blanket exemption,” said Rukundo. “Only one business per individual will be eligible, even if they own multiple entities.”
The tax holiday aligns with broader government efforts to deepen the tax base while simultaneously supporting the development of Uganda’s domestic enterprise sector.
The session also shed light on capital gains tax and the Digital Services Tax (DST)—two less understood but increasingly relevant areas for modern businesses. Rukundo clarified that capital gains tax applies to any disposal of business assets, excluding depreciable assets and inventory, with no minimum threshold for applicability.
On digital services, SMEs were advised to be aware of how tax policy applies to non-resident service providers, especially those offering advertising or cloud-based platforms.
“If you’re paying for ads on international platforms, the provider is taxed through the DST. While there is no direct obligation on SMEs, you may experience marginal increases in fees as providers recover the tax,” Rukundo explained.
Catherine Poran, Chief Executive of SBIL, emphasised that compliance remains a critical challenge for Uganda’s SMEs, many of which collapse due to avoidable regulatory pitfalls.
“Tax compliance is not just a legal requirement; it is a marker of professionalism,” said Poran. “As Stanbic Business Incubator, we aim to equip entrepreneurs not just with capital and connections—but with the knowledge to build resilient, sustainable businesses.”
Held monthly, SBIL Masterclasses are part of the incubator’s broader mission to nurture SME growth through capacity-building and policy literacy. With the fiscal environment shifting, sessions like these offer business owners a crucial opportunity to stay ahead of regulatory changes that could define their growth trajectory.
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