Web based tax returns and the payment allocation system

In the new URA web based tax returns, Rental tax is to become a self-tax type unlike before where it was under the income tax. It has been designed to become a standalone tax type with its own ledger to make the administration by URA be simple and ensure certainty by the taxpayers of what they have filed during the fiscal year.

The Rental Tax Return has the following schedules;

Property schedule

The Property schedule has details where the taxpayer will declare the property where rent is earned.

Tenant schedule- this will be limited to Income Tax return.
Loan schedule- This is intended to be for non-individuals who have mortgages and loans. This schedule will require details of where the loan or credit is sourced and a provision to update documents that pertain to such loans acquisitions .For individuals, trusts, partnerships and companies there will have a separate form
Tax summary schedule. This shows the principal tax, any penalties interest any advance payments made for the period

Steps of filing income tax return for rent related to a new portal

Go to the web address browser and put in http/ura.go.ug
Log in your TIN
Go to eservices,
Click on annual return
Choose the line items of rental
Access excel template and the web return
Fill in the details relating to property code which is system generated, building name, district, municipality, parish , block, plot number , postal address which are the same details as per the registration
There is an add button which helps you to add a row to each entry you make, you will be required to enter the tenant schedule for tenant details or particulars. Where you fill the TIN of the tenant, the names and other particulars will be updated or auto populated and where the field is not mandatory, there is no need to put it.
Once you have filled in the correct information, the tenant schedules will be populated from the property schedule and a tax computed there on in a summary form.
Once the tax computed is correct with the tax payer then you select submit
The return will be submitted and a notification will be sent to your mail with a return acknowledgement number and a payment registration slip.
Proceed to any bank of your choice and make the payment of the rental tax liability due.
Note that non-individual with allowable deductions have access to mortgage and loan schedules which have been catered too in the portal.

Capping the 50% deduction

The capping of 50% deduction and assessed amounts with be auto generated on the web based return,

Expenses in the schedule

Various nature of expense have been pre-defined in the schedule
However, where the expense has not been predefined, the taxpayer is required to put explanation or a short description.

Attachments

The following items can be uploaded and attached on the return

The loan agreement
Statement of particulars for whether the loan is foreign sourced or locally sourced. Where the loan is foreign sourced, declare the country from where the loan has been sourced, where the loan has been sourced locally declared the TIN, and its mandatory field, tenure of the loan, the amount of the loan or duration and any other documents for example the loan agreement.
Where a taxpayer declares a property, he/she will benefit from capital deductions. Note deductions are capped at 50%. The deductions in excess for the property will be accounted for in the income tax return.
For any property declared in prior periods, the tax payer are allowed to declare any improvements

The new payment functionality

There are different things or features to understand from the way the old payment functionality worked against the new functionally.

Old functionality.

The payments were not mapped to basis, for example return, assessment, audit, installment
Payment was allocated to old liabilities on FIFO basis
Payment was made inside logins only
Payments were tagged to banks selected by tax payers
There is no payment corrections of transfer from one tax head to anther or across tax heads

New functionality

All payments are mapped to basis eg return, assessment, audit, installments etc
Payments are practiced inside login and outside logins
Today payments come along with returns and you can pay at any bank of your choice
There is payment corrections or transfer by tax payers across tax heads/types subject to approval by URA team

Payment transfers

While transferring the amounts in whole the system will ask for an attachment that will be a source of supporting evidence. Type the reasons for the transfers, the system will not allow partial balances to be transferred

Moving of amounts from one Tax head to another.

That is from WHT to PAYE or INCOME TAX to VAT. This feature is now available to tax payers. A mistake may have happened at a time of making a PRN of PAYE and instead it is made on WHT. Taxpayers are now able to make corrections by moving amounts from one tax head to another but subject to approval

Transferring of tax payments from one tax payer to another

A mistake still may arise where tax agents who deal with more than one client makes an error by registering a payment in another taxpayers name. Just log in and make this application

Note: In case you have any complaints, log into the URA touchpoint and submit your query

credit balance transfer.

This happens within the same tax type where you file a return and pay but later you find that you over paid the balance over paid will be allocated to future tax payments

Payment redistribution.

Most people, taxpayers and or tax agents misuse this application for transfer yet its not supposed to do transfers but It is used where we have tax heads combined in one payment registration number. For example while filing your income tax before and you also have rental or property income a taxpayer may proceed to make one PRN or in case of VAT and VAT on imported services, a taxpayers may make a single PRN. This from the side of the taxpayer, there is no liability but on the ledger, there is need to redistribute the payment within these tax heads so that there is no liability on each one of them. This helps to remove an over payment from one tax head and a liability from another.

Gross payment

There is a gross payment account in the TINs for taxpayers. This is helping the taxpayers who may not be available at some time but decide to keep money for future tax use on this account. When time comes, you just transfer to a right account

It is meant to help tax payers who may not be present at the due dates., or tax payers who use tax agents you can keep your money on Gross payment accounts, Instead of keeping money in banks and fail to pay on time always use the gross payment account to avoid interest on delayed payments because of absence or other reasons.

Waiver of interest

This happens only when you pay in full or in part, the principal tax amounts before December 31st 2023As external employees of URA (Tax Agents) encourage the tax payers to pay the principal and benefit from this incentive as per section 40D of the TPC

Navigate and use the New Portal, which is very transparent now by showing you the principal and interest separately plus the amounts not utilized or allocated

Computation of interest on prorate basis

It will be the principal amount over part paid by the interest rate.

Impact of transfer on the waiver.

It will reduce the principal and interest will be automatically be removed in the current period. For the periods before, it will look at the oldest periods.