By Nancy Akullo
Practitioners have been encouraged to register as tax agents, to help businesses improve their tax compliance. Tax agents act as an intermediary between URA and taxpayer.
While speaking at the 9th Practitioners’ Forum, CPA Busingye Kelemensio, the Manager of Compliance Management (Domestic Taxes) at Uganda Revenue Authority (URA) said that as part of their new strategic plan, URA is establishing partnerships with professionals like accountants, to improve tax compliance.
According to URA statistics, Uganda has 1.4 million Ugandan businesses registered for taxes, albeit there are 12.9 million potential taxpayers. This means that only approximately 11% are paying taxes, hence the enormous work that is required to increase tax compliance within the economy.
However, CPA Kelemensio expressed concern that there are only 402 licensed tax agents in Uganda. She advised practitioners to register as licensed tax agents because an accountant is well suited to facilitate tax collections in a professional way.
“Tax agents help taxpayers to fulfill their tax obligations. They have an influence on the way taxpayers choose to comply, as many taxpayers find dealing with URA complex and time consuming,” CPA Kelemensio said.
As tax agents, accountants play a significant role in the tax administration process, performing the roles of: tax planning, investment advisory, educating tax payers and compliance support, among others.
One of the major challenges affecting tax compliance is poor book keeping. Many Small and Medium Enterprises (SMEs) do not keep proper books of accounts. This affects filing of returns and the generation of fair tax assessments.
While speaking on the sidelines of the Practitioners’ Forum, CPA Mark Omona, the Director, Standards and Regulation at the Institute of Certified Public Accountants of Uganda (ICPAU) said that many SMEs do not keep proper books of accounts, because they have a wrong perception that professional accountants are very expensive.
CPA Omona advises SMEs to use an affordable model, where they seek the services of professional accountants on a part time basis, rather than on a full time basis. “SMEs can hire professional accountants to set them up with a tailor-made accounting system and then the accountant can perform regular reviews once or twice a month,” CPA Omona said.
He advised that the alternative is to employ accounting technicians who have studied the Accounting Technicians Diploma (ATD). “Accounting Technicians can competently perform book keeping roles, at affordable rates,” CPA Omona said.
Attended by over 213 practising accountants, the annual Practitioners’ Forum was held on 24 January 2019, at Imperial Royale Hotel. The Forum is organized by the Institute of Certified Public Accountants of Uganda (ICPAU).