Course Name:           Elements of Taxation

Course Code:                         DFA 2207

Course Level:                         Year Two Semester Two

Credit Unit:                                3CU

Brief Course description

An in-depth examination of taxation as related to partnerships, corporate tax planning, combinations reorganizations, liquidations, trusts, estates & gifts.

Objectives of the course

By the end of the course students should be able to:

· Use the acquired skills in advising management of different firms or individuals on their tax liabilities as stipulated under the tax framework of Uganda Government

· Explain the basic principles of taxation

· Outline the various taxes imposed with reference to Uganda

· Discuss the tax administration in Uganda and the related statutory framework.

Learning outcomes

At the end of the course students should be able to;

· Analyze the tax framework for business transactions.

· Evaluate the tax consequences of various types of structure of business transactions as well as the tax factors and problems for investment decisions in these two areas.

· Formulate and prepare and appraise tax planning ideas and strategies for business transactions in order to minimize their explicit tax liabilities or enhance their tax efficiency and effectiveness.

· Appreciate the contemporary tax issues in respect of law, practices, guidelines and case decisions.

COURSE OUTLINE

Introduction (6 Hrs)

Definition of taxation

Rationale of taxation

History, origins and development of taxation in Uganda

Principles / canons of taxation

Theories underlying taxation

Tax structure and administration in Uganda (9 Hrs)

· URA - central government

· Local government

· Meaning of income tax for tax purposes

· Listed organizations

· Exempt persons and organizations

· Residence as used in tax

· Non residence as used in tax

· Implication of being a resident or a non resident

· Advantages accruing from residence status and disadvantages thereof.

Types of taxation procedures ( 9 Hrs)

· Introduction

· Determining a tax payer

· Classification of taxes i.e. Direct and indirect Progressive and Regressive

· Advantages of each of the above

· Equity in taxation

· Implication of tax type to tax management

· Sources of income

· Description of income taxes and taxable persons

Employment Income (9 Hrs )

· Meaning of employment income

· Employment contract

· Components of employment income

· Valuation of income in kind

· Exempt employment income

· Computation of employment income

· Comprehensive worked examples on employment income

· Foreign earned incomes

Capital allowances (6 Hrs)

· Meaning

· Underlying concepts

· Capital deductions

· Plant and machinery

· Industrial building allowance

· Mining deductions

· Farm deductions

· Initial allowances

· Implications of capital deductions

Income tax computations (6 Hrs)

· Exempt income

· Taxable incomes

· Provision for bad debts

· Depreciation

· Apportionment of expenditure

· Capital items

· Rates of tax

· Withholding tax

· PAYE

· VAT

· Comprehensive example on income tax computation

Mode of delivery

· Class lectures / Tutorials

· Group discussions

· Library search and use of internet

· Individual presentations

Mode of Assessment

Course Work       50%

Final Exam        50%

Total       100%

References

Bhatia, H. L., 2004 Public finance, 24^th Revised ed. Vikas

Jones, S.M.,2001. Public finance – an introduction. Routledge and Kegan Paul

Jhingan, M.L.,1998.Micro economic theory. 4^th ed Konak Publishers, PVT Ltd

Saleemi, N.A., and Bongoko, 1999. Taxation II simplifiedpublishers, Nairobi:

Statutes

The URA statute, 1991

The VAT statute, 1996

The Income tax act, 1997

The Local Government Act, 1997

Tumuhimbise, M., 2000, Introduction to taxation in Uganda, MUBS

Prof: Banugire: Income tax in Uganda

Waswa Balunywa: Income tax administration in Uganda

Income tax decree 1974 as amended in the recent finance bills