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Yes, the analysis of Kampala's property market is included in our pack
Understanding property taxes and fees in Kampala is crucial for anyone considering buying real estate in Uganda's capital city.
From annual property taxes to stamp duty fees and registration costs, the Kampala property market involves several financial obligations that buyers need to factor into their investment calculations. As of September 2025, the tax structure includes a 6% annual property tax rate for commercial and rental properties, 1.5% stamp duty on transfers, and various registration and valuation fees that can significantly impact your total investment cost.
If you want to go deeper, you can check our pack of documents related to the real estate market in Uganda, based on reliable facts and data, not opinions or rumors.
Property taxes in Kampala include a 6% annual rate on commercial and rental properties, 1.5% stamp duty on transfers, and registration fees ranging from UGX 500,000 to UGX 2,000,000.
Owner-occupied residential homes are exempt from the annual property tax, but all property transactions still require stamp duty and registration fees to be paid.
| Tax/Fee Type | Rate/Amount | Application |
|---|---|---|
| Annual Property Tax | 6% of Annual Rental Value | Commercial & rental residential properties |
| Owner-Occupied Tax | Exempt | Primary residence only |
| Stamp Duty | 1.5% of property value | All property transfers |
| Registration Fees | UGX 500,000 - 2,000,000 | All property purchases |
| Valuation Fees | UGX 500,000 - 2,000,000 | Required for transactions |
| Late Payment Interest | 2% monthly | Overdue property taxes |
| Land Transfer Tax | 5% (proposed) | Land sales/transfers |
What is the annual property tax rate in Kampala?
The annual property tax rate in Kampala is 6% of the property's annual rental value (ARV) for commercial properties and non-owner-occupied residential properties.
Owner-occupied residential homes receive a complete exemption from this annual property tax under the Kampala Capital City Authority (KCCA) regulations. This means if you live in your own property as your primary residence, you won't pay the annual 6% property tax.
Commercial properties, rental residential units, and investment properties are all subject to the full 6% rate. The tax is calculated based on what the property could realistically rent for annually, not on the purchase price or market value.
As of September 2025, this rate structure remains unchanged from previous years, making it predictable for property investors to calculate their ongoing tax obligations.
How is property tax assessed in Kampala, and what factors determine the value?
Property tax assessment in Kampala is conducted by qualified valuation surveyors or tax assessors who estimate the annual rental value (ARV) that a property could generate in its current condition.
The primary factors that determine property value for tax purposes include the physical structure and condition of the building, the property's location within Kampala, any improvements or renovations made to the property, and the realistic rental income the property could generate based on current market rates.
Assessors examine comparable rental properties in the same area, consider the property's size, condition, and amenities, and factor in the local rental market dynamics. The assessment focuses on income potential rather than purchase price or market value.
Property owners can request reassessment if they believe their property has been overvalued, though this process requires providing evidence of lower rental potential or property condition issues that weren't considered in the original assessment.
Are there different property tax rates for residential and commercial properties in Kampala?
Yes, there are different treatment levels for residential and commercial properties, though the base rate remains 6% for taxable properties.
| Property Type | Tax Rate | Tax Status |
|---|---|---|
| Owner-occupied residential | 0% (Exempt) | No annual property tax |
| Rental residential | 6% of ARV | Fully taxable |
| Commercial properties | 6% of ARV | Fully taxable |
| Vacant land | 0% (Exempt) | No annual property tax |
| Government properties | 0% (Exempt) | No annual property tax |
| Religious institutions | 0% (Exempt) | No annual property tax |
| Charitable institutions | 0% (Exempt) | No annual property tax |
What is the current rate for land tax in Kampala, and how is it calculated?
Land tax in Kampala operates differently from the annual property tax, with ongoing land ownership generally not subject to the same 6% annual rate.
For leasehold public land, ground rent is payable according to the specific lease agreement terms, with rates varying significantly by location and lease conditions. These payments are typically annual but at much lower rates than the 6% property tax.
A significant recent development is the proposed 5% tax on land sales or transfers, calculated on the gross sale price of the land. This would be a one-time tax paid during the transaction, not an annual obligation.
It's something we develop in our Uganda property pack.
Private freehold land doesn't typically have ongoing ground rent obligations, though all land transactions still require stamp duty and registration fees regardless of tenure type.
Is there a stamp duty fee when transferring property ownership in Kampala?
Yes, stamp duty is mandatory for all property ownership transfers in Kampala and throughout Uganda.
The stamp duty applies to every property transaction, whether it's a sale, gift, inheritance transfer, or any other form of ownership change. No property transfer can be legally completed without paying the required stamp duty.
This fee must be paid before the property transfer can be registered with the relevant authorities, making it an unavoidable cost for all property transactions.
Both buyers and sellers should factor stamp duty into their transaction calculations, as the transfer cannot proceed without this payment being completed and verified.
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What is the percentage of stamp duty on property transactions in Kampala?
The stamp duty rate for property transactions in Kampala is 1.5% of the property's value, calculated on whichever is higher between the sale price and the assessed market value.
Additionally, there's a fixed fee of UGX 15,000 that applies specifically to agreements or memorandums related to the property transaction.
For example, if you're buying a property worth UGX 200 million, the stamp duty would be UGX 3 million (1.5% of UGX 200 million) plus the UGX 15,000 agreement fee, totaling UGX 3,015,000.
The 1.5% rate applies regardless of whether you're a Ugandan citizen or foreign investor, making it a standard cost across all property transactions in the Kampala market.
Are there registration fees when purchasing a property in Kampala, and how much do they cost?
Yes, registration fees are required for all property purchases in Kampala and typically range from UGX 500,000 to UGX 2,000,000 depending on the property's size, location, and value.
Premium properties or large commercial properties may have higher registration fees that exceed the standard range, particularly for high-value transactions in prime Kampala locations.
These fees cover the administrative costs of officially registering the property transfer with the Uganda Registration Services Bureau and updating the land title records.
Registration fees are separate from stamp duty and must be paid in addition to all other transaction costs, making them a significant component of the total purchase expenses.
What is the fee for property valuation when buying or selling in Kampala?
Professional property valuation fees in Kampala range from UGX 500,000 to UGX 2,000,000, depending on the property's size, location, and complexity of the valuation required.
Larger properties, commercial buildings, or properties in premium locations typically command higher valuation fees due to the increased complexity and time required for accurate assessment.
Valuation is typically required for mortgage financing, insurance purposes, tax assessment, legal transfers, and investment decision-making, making it an essential cost in most property transactions.
It's something we develop in our Uganda property pack.
Both buyers and lenders usually require independent valuations, so this cost should be factored into your transaction budget regardless of whether you're paying cash or using financing.
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Are there any maintenance fees or levies imposed by the local government on properties?
Local governments in Kampala may impose various inspection fees and building permit fees, with building inspections typically costing 1,000 shillings per square meter in city areas.
- Building inspection fees at 1,000 UGX per square meter for new constructions or major renovations
- Building permit fees that vary based on the construction value and property type
- Parking fees for commercial properties or multi-unit residential buildings
- Market dues for properties used for commercial trading activities
- Utility connection charges for new water, electricity, and sewer connections
Unlike some countries, Kampala doesn't have ongoing municipal "maintenance fees" that property owners pay annually, but specific levies apply depending on property usage and location.
Commercial properties may face additional fees related to business licensing, signage permits, and waste collection services depending on their specific business activities.
What are the fees for late payment of property taxes in Kampala?
Late payment of property taxes in Kampala incurs a 2% monthly interest charge on the unpaid balance after the payment becomes more than 30 days overdue.
This 2% monthly interest compounds, meaning if you're late for multiple months, the interest continues to accumulate on both the original tax amount and any previous interest charges.
For example, if you owe UGX 1 million in property taxes and you're 60 days late, you would pay UGX 1,040,400 (original amount plus two months of 2% monthly interest compounded).
There are no separate penalty fees for late payment of ground rent on leasehold properties, though lease agreements may contain specific late payment clauses that differ from the standard property tax interest rate.
Are there any other hidden or additional costs involved in property transactions in Kampala?
Several additional costs beyond the main taxes and fees can significantly impact your total property transaction expenses in Kampala.
- Legal fees typically ranging from 1-2% of the property value for transaction assistance
- Survey fees ranging from UGX 1 million to UGX 3 million for property boundary verification
- Foreign approval fees if you're a non-Ugandan citizen purchasing property
- Due diligence costs for property title verification and background checks
- Notary fees for document authentication and witnessing
- Utility connection charges for electricity, water, and sewer services
- Compulsory property insurance coverage required by most mortgage lenders
- Currency conversion costs if paying in foreign currency
Buyers should also verify that all existing property taxes and fees are fully paid by the seller before completing the purchase, as outstanding debts typically transfer with the property.
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What is the process for paying property taxes in Kampala, and where can payments be made?
Property tax payment in Kampala begins with annual demand notices and bills issued by KCCA at the start of each financial year.
Payments can be made at several designated banks including Diamond Trust Bank, DFCU Bank, Stanbic Bank, and Equity Bank, which have been authorized to collect property tax payments on behalf of KCCA.
KCCA's eCitie digital platform allows online property tax payments, providing a convenient alternative to visiting physical bank branches.
Mobile payment options are also available through various mobile money services, making it easier for property owners to pay their taxes promptly.
Clearance of all owed property rates is mandatory before any property transfer or registration can be completed, ensuring that new owners don't inherit tax debts from previous owners.
Conclusion
This article is for informational purposes only and should not be considered financial advice. Readers are advised to consult with a qualified professional before making any investment decisions. We do not assume any liability for actions taken based on the information provided.
Understanding property taxes and fees in Kampala is essential for making informed real estate investment decisions in Uganda's capital city.
As of September 2025, the combination of annual property taxes, stamp duty, registration fees, and additional costs can significantly impact your total investment, making careful budgeting crucial for successful property ownership in Kampala.