How to apply for a trading license in Uganda

A trading license is permission from the state government to conduct a specific business or trade, governed by state laws and municipal regulations. Its purpose is to prevent unethical business practices.

Why should people apply for a trading license?

It is a legal requirement for any person selling goods and services as provided for by the licensing act CAP 101 and the trade licensing Amendment Act of 2015. In Kampala, the Kampala Capital City Authority (KCCA) is required to regulate trade and does so by licensing businesses.

Outside of Kampala, the process is handled by the local council authorities such as the municipal and town councils.

When can one apply for a trading license?

One should apply for a trading license as soon as they receive a certificate of incorporation for their business. It 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 immediately renewed.

Who is eligible to apply for a trading license?

Any person carrying out businesses, except those who are exempted under Section 8(2) of the Trade Licensing Act. The exempted businesses include among others the following:

• Any trade carried out in a market.
• The trade of a planter, farmer, gardener, dairy person or agriculturist in respect of sale of his or her own dairy or agriculture produce.
• The trade of a person in respect of goods made by him or her by his or her handicraft in or any premises where he or she normally resides, or by the handicraft of persons normally residing with him or her or who are his or employees or members of his or her family.

How is a trading license acquired in Kampala?

Obtaining a trading license in Kampala involves a formal application process directed to the Kampala Capital City Authority (KCCA). To secure a license for conducting business, certain conditions must be met, including:

• Ensuring that the business is located in appropriate premises.
• Maintaining hygiene and health standards at the business premises to meet the city's regulations and ensure a safe environment.
• Adhering to the appropriate building standards for the business premises.
• Meeting required personal specifications, which may include demonstrating medical fitness or fulfilling other criteria relevant to the nature of the business.
• Paying the necessary license fees as stipulated by KCCA.

Requirements for individuals, whether they are nationals or refugees, operating businesses as sole proprietorships.

• Identification (a national ID or a refugee ID)
• Taxpayer identification number (TIN)
• Trading license for the previous year (in case of renewal)
• Registration certificate/ certificate of incorporation
• Statement of particulars (this contains details about the business)
• Rent receipts (for new business)

Requirements for a company

• Copies of identification documents for each director (National ID, Refugee ID, Employment ID)
• 2 passport photos
• Taxpayer identification number (TIN)
• Trading license for the previous year
• Certificate of incorporation
• Company forms 7 and 9
• Rent receipts (for new business).

Requirements for non-nationals

• Taxpayer Identification number (TIN) certificate
• Ministry of trade clearance for non-East Africans
• Clearance from office of the prime minister for Refugees
• Original work permits/ entry permits.
• Original certificate of incorporation of the company for the new business
• Original company form 7
• Identification of directors
• Original Rent receipts and tenancy agreement from the Landlord for the new business.

How is trading license levied or paid?

Trading license fees vary depending on the type and size of business.

Assessment is done based on the fees schedules issued by the Minister of Trade, Industry and Cooperatives under statutory instrument No 54 of 2011 (Please take a look at the attached file to see the fees relating to your business).

Based on this, a KCCA Revenue Officer issues a taxpayer a KCCA Bank Payment Advice Form to make payment at any designated Banks. A receipt is given which is presented at the Division offices where a trading license certificate is issued.

How to apply for a trading license at the Municipal or town council

Contact the Municipal Council in your district: Reach out to the municipal council or the designated department responsible for trading licenses. Inquire about the specific requirements, procedures, and fees for obtaining a trading license.

Gather necessary documentation: Prepare the required documents, which may include identification documents (such as a national ID or refugee ID), proof of address, business registration documents, tax identification number (TIN), and any other documents specified by the municipal council.

Complete the application form: Obtain and fill out the trading license application form. Provide accurate and complete information about your business, including the nature of the business, location, and other relevant details.

Pay the required fees: There is usually an application fee associated with obtaining a trading license. Inquire about the fee amount and the acceptable modes of payment. Ensure that you submit the required payment along with your application.

Submit the application: Submit the completed application form, along with the necessary supporting documents and payment, to the designated office or department of the Municipal Council. Keep copies of all submitted documents for your records.

Await processing and approval: The municipal council will review your application and process it accordingly. The duration for processing can vary, so it is advisable to inquire about the estimated processing time.

Receive the trading license: If your application is approved, you will be issued a trading license. The license will specify the permitted scope of your business activities and the duration of validity.

Ensure that you display the license prominently at your place of business as required.

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