VAT ACCOUNTS AND RECORDS

THE VAT REGULATIONS REQUIRE A VAT REGISTERED PERSON TO DISPLAY HIS VAT REGISTRATION CERTIFICATE AT HIS PRINCIPAL PLACE OF BUSINESS AND TO MAINTAIN AND KEEP VARIOUS RECORDS

The VAT Statute defines the records which a VAT registered person is required to keep. These requirements are further detailed in the VAT Regulations.

A. ALL VAT REGISTERED PERSONS ARE REQUIRED TO KEEP THE
FOLLOWING:

1) A VAT account: - This is the information which is entered on your VAT Return. The information can be retained in an account book, or on a computer, but many people prefer to retain a copy of each VAT return and maintain these copies in a file as a permanent record.

2) Purchases Record: - This should be divided into three separate
accounts:

(a) Local purchases, and the VAT thereon;
(b) Imports and the VAT thereon;
(c) All other purchases, including exempt, zero-rated purchases and purchases from suppliers who are not registered for VAT - where you will not have been charged any VAT.

You should also retain and file separately the following in order of date:
(a) Original tax invoices including simplified invoices, received from your local suppliers, and original debit and credit notes received from your suppliers.
(b) Certified copies of Customs Bills of Entry
(c) Purchase invoices received for all other purchases.

Remember if you are unable to produce an original tax invoice or a certified customs Bill of Entry the Uganda Revenue Authority will disallow your claim for credit of input tax.

3)Sales Record: - This should be divided into three separate accounts;
(a) Taxable Sales at the standard rate and the VAT thereon, or VAT charged therefrom;
(b) Taxable Sales at the zero rate
(c) Exempt Sales.

You must also retain and separately file the following in order of date: -

(a) copies of tax invoices, including simplified invoices related to your taxable sales, and copies of any debit or credit notes issued to your customers. If you use cash accounting or a small trader scheme you must keep a daily record of your gross takings at the standard rate.

(b) Copies of invoices of goods sold at the zero-rate, or a daily record of the value of your sales at the zero rate if you use cash accounting or a small trader scheme.

(c) Copies of invoices of exempt goods sold or a daily record of the value of your exempt sales if you use cash accounting or a small trader scheme.

4) Debit and Credit Notes - Copies of Debit and Credit Notes issued should be separately filed from Debit and Credit Notes received. They should all be filed in order of date.

5) Do you export? - Then you must retain the following: -

a certified copy of the Customs Export entry

a purchase order form or contract with the foreign customer

a copy of the invoice issued to the foreign customer

evidence of transportation from Uganda in the form of copies of transit documents, such as airway bills, shipping bills or road or rail transit documents.

6) Cash Records

All records of your cash transactions must be retained including cash books, petty cash vouchers, all account books, records of daily takings including till rolls, copy receipts, or daily takings records.

7) Stock and Manufacturing Records - These records must be maintained where applicable.

8) Do you use a computer in your business? - If so, you must retain your computer records to tally with the manual records.

9) If you are registered and make exempt sales - In these circumstances
you must retain records of all your calculations to credit INPUT TAX

10.) If you make a claim for VAT you paid on purchases you made (opening stock) before your registration for VAT, make sure you have the documents and records related to your claim.

B. VAT REGISTERED PERSONS WHOSE TAXABLE TURNOVER EXCEEDS 200 MILLION SHILLINGS PER ANNUM must retain the following, in addition: -

• orders and delivery notes
• all business correspondence
• appointment and job books
• annual accounts - including trading accounts, profit and loss accounts and balance sheet.
• Bank statements and paying in records.

REMEMBER

THE LAW REQUIRES THAT ALL THE SPECIFIED ACCOUNTS AND RECORDS BE RETAINED FOR AT LEAST 6 YEARS AND MADE AVAILABLE TO AUTHORISED OFFICERS OF THE URA ON OFFICIAL DUTY.

THERE ARE SEVERE PENALTIES FOR FAILING TO MAINTAIN THE SPECIFIED RECORDS.

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