How to register a company in Uganda?
If you are planning on starting a business in Uganda, company registration is the first thing you should focus on. The second step is to make sure that you know the type of company you want to register. After which, you need to understand all the compliance requirements. Let’s have a look at how to register a company in Uganda.
What does company registration entail?
Companies are incorporated under the Companies Act 2012. In Uganda, the Uganda Registration Services Bureau (URSB) is mandated under the Uganda Registration Services Bureau Act Cap 210 to register all business entities in Uganda which are required by law to be registered.
Company Registration entails steps such as name reservation, filing and signing of forms, Memorandum & Articles and submission to the Uganda Services Registration Bureau (URSB). This process leads to issuing of either Certificate of Incorporation for a Local company or a Subsidiary, or Certificate of registration for a foreign company.
What do you need to do to register your company in Uganda?
There are several requirements and steps that need to be followed. Let us expound on a few of them below:
TIN registration for at least one of the Directors – a Tax Identification Number (TIN) is a requirement for any person doing business in Uganda and it is issued by the Uganda Revenue Authority (URA). If the directors of the registered company are all foreigners, then at least one of them has to acquire a special pass so as to be allocated a Tax Identification Number (TIN).
Ministry of Trade Clearance – This is a Clearance Certificate issued to companies whose directors are Foreigners, to enable the company to carry out business and trade in Uganda. It is a requirement to be able to obtain and trading license.
Trading License – issued by the Kampala Capital City Authority (KCCA). This is the governing body of the Capital City and administers Capital City on behalf of the central government. The authority issues the trading licenses for businesses that are being established within the city.
NSSF registration – The National Social Security Fund (NSSF) is one of the remittances that are done by a company. This is deducted from the employees by the employer and remitted to the government. NSSF is a saving scheme for retirement. An employee pays 5% of their gross salary and an employer contributes 10% to the employee, totaling to 15%.
What type of company can you register in Uganda?
Now that you have seen what the process of registering a company is, we can look at what types of companies can be registered in Uganda:
Company limited by shares
This is defined as a company having the liability of its members limited by the memorandum to the amount, if any, unpaid on the shares respectively held by them. These are categorized into two categories:
Single Member Company (SMC)
Where two or more persons hold one or more shares in a company jointly. This type of company carries an acronym on the reserved company lame.
A private company has more than one shareholder. Under the company Act 2012, a private company means a company which by its articles restricts the right to transfer its shares and other securities, and also limits the number of its members to one hundred, not including persons who are employed by the company and persons who, have been formerly employed by the company; and prohibits any invitation to the public to subscribe for any shares or debentures of the company.
This is defined as a company that is incorporated outside Uganda which has established a place of business in Uganda and continue to have a place of business in Uganda.
Company limited by guarantee
This is a type of company where the liability of its members is limited by the memorandum to the amount that the members undertake in the memorandum to contribute to the assets of the company if it is being wound up. Some organizations may prefer to register this type of company where board members act as guarantors. This option is ideal for associations and not-for-profit organizations
After you register your company in Uganda successfully, it is important to note that the income of all companies derived from Uganda is taxable. A company is liable to pay tax separately from its shareholders. The sources of a company’s income on which tax can be levied varies. This includes profits and gains from any business carried on for whatever period of time. Other sources include dividends from shares in other companies and interest from the use of the company’s property.
As we wind up, dealing with government bodies during registration of your company can be quite a hustle. The long queues and waiting hours do not help. Let us look on the bright side though, once your company is registered you get to enjoy an array of benefits such as: safeguarding your business name by acquiring a trade name, helps you obtain a legal status, enables registration for licenses e.g. investment, trading and taxation licenses and most importantly improved competitiveness in the regional market.
It is therefore very important to look for experts who can assist you register efficiently a company in Uganda. This will be a prerequisite to start operating in some sectors in Uganda. Once done, you have an empty shell to operate with. So you can start your business at your own pace and in full compliance.