What is the governing law for administration of Property rates?
The Kampala Capital City Authority Act 2010 and the Local Government (Rating) Act 2005 as amended to-date
-Currently, property rates in respect of properties located within the city are computed at a rate of 6% of the rateable value of the property and are payable once in a financial year.
-The values on which property rates are based are determined by qualified and registered Valuation Surveyors
- Residential owner occupied properties currently are exempted from attracting property rates.
What are some key terms I need to know?
Rateable Value: means the net annual rental value of a property ascertained in accordance with the Local Government Rating Act.
Property: means immovable property including buildings or structures of any kind excluding vacant sites.
Who is eligible to pay?
Section 7(1) of the Local Government (Rating) Act provides "that the person liable for payment of the rate shall be the owner of the property in respect of which the assessment is made." Therefore, anyone who owns a building which is used for commercial purposes (including residential rented properties) is eligible to pay.
What happens if I fail to pay in time?
If a property owner fails to pay his/her property rates due, KCCA will recover these funds through the following:
· Recovery by warrant:
This is done through the magistrate granting the warrant upon satisfaction that the person sought to be proceeded against is the person liable to pay the amount that the amount is due from him or her.
· Recovery by auction:
This allows KCCA to auction the property for the recovery of the amount of rate and interest, if any.
· Recovery from tenants and current occupiers
This is where KCCA demands the rate from any person paying rent or any other periodic payment in respect of that property or any part of it requiring all future payments of rent or any other periodic payments to be made directly to the Authority until those arrears and interest have been duly paid.
In such cases, any payment received from such a person as above to be credited to the person liable to pay the rate.
What happens if I buy (purchase) a property from someone?
· Buyer to satisfy himself or herself about arrears:
It shall be the right of the buyer to demand a certification of arrears from the seller, and if the seller does not produce the certificate, the buyer may inquire from the Authority upon the payment of a prescribed fee.
· Prohibition against transfer of property in arrears of rate:
No transfer of any property shall be registered under any law for the time being in force, for the registration of titles or documents unless a certificate that no arrears of rates are due in respect of that property has been issued by the Authority of the area where the property is situated.
Who is exempted from paying Property rates Tax?
The following properties are exempted from paying property rates tax under the Local Government Act 2005 and its amendments of 2006;
· Any official residence of the President
· Any official residence of a traditional or cultural leader.
· Any property used exclusively for public worship, and as a residence of a religious leader.
· Any property used exclusively as a cemetery or as a crematorium.
· Any property used exclusively for the purposes of any charitable or educational institution of a public character supported only by endowments or voluntary contributions.
· Any property laid out and used exclusively for the purpose of outdoor sport or recreation.
· Any property belonging to a local council.
· Any property belonging to a mission/organization entitled to privileges under the diplomatic privileges Act.
· Any property belonging to an organization in respect of which Uganda is obliged under any international convention or treaty.
· Any property belonging to any institution with which Government has contractual obligation not to levy fees and tax against it.