Uganda

Effective 1 July 2026, there have been significant developments in respect of income tax rates applicable to resident individuals per Schedule 4 of the 2026 Income Tax Amendment Act. The overall impact is summarised as follows:

• There is a net monthly saving between UGX 10,000 and UGX 13,750 depending on the resident individual’s gross employment income.
• A resident individual earning a monthly gross pay of not more than UGX 335,000 (UGX 4,020,000 per year) will be exempt from PAYE.
• The Act eliminates the 10% individual rate as individuals previously under this category will now be exempt from PAYE. It also seeks to introduce a 25% PAYE rate for individuals earning above UGX 410,000 up to UGX 485,000.
• The 30% band will now be applicable to individuals earning a monthly gross pay of UGX 485,000 – UGX 10,000,000. Previously, the 30% band used to kick in at UGX 410,000.
• The 40% band has been maintained to apply to monthly gross earnings above UGX 10,000,000.