By Joshua Niyonshima
Ugandans have been urged to legalize their documents through the payment of Stamp Duty to ensure their legal validity in courts. The call was made by Paddy Ochieng, the Manager of Stamp Duty at Uganda Revenue Authority (URA), during his appearance on the URA online TV.
Ochieng explained that various legal instruments can be legalized through Stamp Duty, including acknowledgment of debt exceeding 100,000 shillings, administration bonds, affidavits, declarations, lease agreements, bank guarantees, and power of attorney.
He emphasized that paying the appropriate Stamp Duty ensures that these documents are recognized by the courts and can be used in legal proceedings.
Without Stamp Duty, legal documents may not be considered valid in Ugandan courts, potentially leading to serious issues in enforcement or dispute resolution. “Stamp Duty guarantees that legal documents and transactions are recognized by the courts of law,” Ochieng stated. “Without it, these documents might not hold up in court, which could create significant complications for individuals or businesses,” he added.
Ochieng also explained that Stamp Duty is a non-tax revenue imposed on legal instruments as outlined in the Stamp Duty Act, Cap. 339 and is crucial for ensuring the legitimacy of agreements and transactions.
“This duty applies to documents that create, transfer, or modify rights and liabilities,” Ochieng said.
In a separate interview on BBS TV, Viola Nandaula of Domestic taxes defined stamp duty as any document that formalizes a right or obligation, such as contracts, agreements, and various legal declarations. She emphasized that individuals and businesses involved in signing or executing these documents may be required to pay Stamp Duty.
“The responsibility for paying Stamp Duty lies with the person who draws, makes, or executes the instrument,” Nandaula explained. “For example, a business or individual entering into a contract or executing a power of attorney may be required to pay Stamp Duty.”
Nandaula also outlined the payment deadlines for Stamp Duty, noting that it must be paid within 45 days for documents executed in Uganda, and within 30 days for those received from abroad. Failing to meet these deadlines could result in penalties and complications regarding the legal standing of the document.
Regarding exemptions, Nandaula explained that certain agreements, such as those made by the government or international organizations, are exempt from Stamp Duty under the VAT Act and Income Tax Act. Additionally, the Minister of Finance Planning and Economic Development has the authority to grant exemptions for certain instruments.
While failing to pay Stamp Duty does not make a document null and void, Ochieng warned that it renders the document unacceptable in court.
“This can create serious problems for anyone trying to enforce a document that lacks the required Stamp Duty,” he advised.
