Business formalization refers to the process of legally registering and structuring a business to ensure it operates within the Ugandan legal framework.

A formal business is one that has registered with Uganda Registration Services Bureau (URBS) and obtained a business or Company name, registered for taxes with Uganda Revenue Authority (URA) and obtained a Tax Identification Number (TIN) and has secured permission to trade in any desired area/place through obtaining a Trading License

Why do I need to register my business?

Growth and continuity: Enhanced business reputation leads to a broader and loyal clientele, which is essential for business expansion and growth.
Better access to financial services: Such as bank loans and other Government financial interventions that are essential for business expansion.
Attracting investors: Formally registered businesses are more attractive to investors who may want to buy into your establishment.
Acquiring a TIN: Helps you process land transactions and eases the payment of stamp duty on land transfers and motor vehicle applications.
Claim tax refunds: Formalization helps you claim tax refunds where you could have paid excess taxes.

Business Formalization Process

Step 1 – Business/Company Registration with URSB

The business formalization process begins with the URSB, where one gets a Certificate of Registration (for a business) or a Certificate of Incorporation (for a company). Businesses can be registered as local, public, or foreign entities. The business types vary from partnerships, sole proprietorships, to limited companies.

A search is conducted to find out if the business/company name is under use or not.
The name is thereafter reserved if it’s found available. For a Local Limited Company by shares, the cost depends on share capital.
After name reservation, the following documents are filled with the Registrar of Companies if you are registering a company:
- Form S18 (for a Local company limited by shares or limited by guarantee)
- Memorandum and Articles of Association (for a Local company limited by shares or limited by guarantee)
- Form A1- Statement of Nominal Capital
Following submission and payment of assessed fees, a certificate of incorporation or registration is issued.
A Certificate of Registration is issued where a business is registered in your own name or incorporated outside Uganda. A company is issued a Certificate of Incorporation since it is a separate legal entity with its own identity under law.

Note: Please visit URSB Business Registration for more information.

Step 2 – Registration with URA

Apply to register for a business TIN on the URA website. Registration has been made easy with a web-based form that does not require you to print and submit.

URA will issue you a TIN through the email address given at the point of application.

A TIN is a unique 10-digit number used for all tax purposes a person is registering for.

What you need when registering for a TIN

Individual applications

Individual: A National Identity Card or any two IDs such as Passport, Driver's Permit, NSSF Card, Employment ID, Bank Statement, Village ID, Work Permit, Local Council ID.
Sole proprietor: Certificate of registration, Statement of particulars, in addition to a National ID or any two IDs mentioned above.

Non-Individual applications

Company: TIN of Directors, Company Form 7 or 20, Certificate of Incorporation.

Step 3 – Trading License & Registration with the Local Council Authority (e.g., KCCA)

A trading license is permission granted by a controlling authority to someone upon application to do something in a prescribed manner, usually after fulfilling certain conditions and/or payment of a fee.

At the local council authority, upon approval of a Trading License application, you will be given a trading license to enable you to operate your business in a delineated Local Authority countrywide.
“Trade” or “trading” means the selling of goods and services for which a license is required in any trading premise. A trading “premise” includes any structure attached to the land, whether of a permanent or temporary nature.
A trading license is valid for twelve months from the date of issue and expires immediately at the lapse of the twelve months, after which it must be renewed.

Requirements for Trade License application

A National ID
URSB Registration Certificate for individuals/original Certificate of Incorporation for the company for new businesses
Statement of particulars for individuals and Company forms 7/Company or 20 for non-individuals
A Tax Identification Number (TIN)
Original Trading License for the previous year for an already existing business
Original payment receipt for the previous year for an already existing business
Original rental receipt and tenancy agreement from the landlord for the new business
The client must be at least 18 years of age, and if a minor, should be in partnership with a person above 18 years of age.

Contact your adviser

Ivet Orellana

adviser CONAMYPESan Salvador

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