This process is initiated by the client(s) to the URA commissioner, to be certified as compliant with their tax obligations with URA. The client receives a tax certificate from URA confirming that a person’s tax affairs are in order at the date of issuance of the Certificate.
Types of Tax Clearance Certificates
Annual Tax Clearance Certificate; This is issued once a year to clients who have complied with all their tax obligations. This certificate may be issued to only clients whose compliance has been monitored for at least three (3) years.
Transactional Tax Clearance Certificate; This is issued to a client upon application if the station head is satisfied that the client is complying with their obligations. It must be addressed to the entity for which the facility was applied for; and once submitted by the client to the third party, the transactional tax clearance expires.
Why you need a Tax Clearance Certificate
An application for a Tax Clearance Certificate will enable you to reduce tax burdens where one is prompted to clear up any tax obligation(s) in the course of the year before obtaining the certificate.
A Tax Clearance Certificate facilitates easy acquisition of work permits for those persons who look forward to working in foreign countries.
It also facilities re-export and import of certain restricted goods such as tyres, sugar, etc.
A Tax Clearance Certificate is required in cases where a client is;
- Providing transport services for passengers and goods.
- Tendering process with the Government.
- Transferring funds abroad in excess of Ug. Shillings 50 million.
- Cancellation of a Tax Clearance Certificate can be done on request by the client to their office of jurisdiction.
- Persons who have not operated for more than three years may not qualify for an annual Tax Clearance Certificate.
- The tax clearance certificate will be addressed to the address provided by the client.
- When applying for a TCC, the addressee’s correct accounting date should be quoted.