UGANDA, Kampala | Real Muloodi News | The Uganda Revenue Authority (URA) has tightened tax compliance measures by requiring landlords in the rental sector to issue Efris invoices. The directive requires all landlords to use the Electronic Fiscal Receipting and Invoicing System (EFRIS) to record rental transactions and issue invoices to tenants.
The introduction of Efris invoices forms part of URA’s broader tax compliance strategy, aimed at curbing revenue loss from undeclared rental income.
The measures build on the Rental Tax Compliance System (rTCS) project, a five-year initiative launched in October 2020. Initially piloted in the Greater Kampala metropolitan area, the project has since expanded nationwide to include Arua, Gulu, Lira, Soroti, Mbale, Jinja, Mbarara, Fort Portal, Masaka, and Hoima—enabling broader coverage and enforcement.
The Ministry of Finance had set FY 2018/19 as the baseline to measure the project’s impact, since rental tax revenues had dropped by nearly USh12 billion in FY 2019/20 due to COVID-19 lockdowns. Revenues were USh115.60 billion in FY 2018/19 and rose to USh331.39 billion by FY 2024/25, nearly tripling the baseline—demonstrating the Rental Tax Compliance System’s transformative impact in improving tax payer compliance and reducing revenue leakages.
The authority has directed that all rental payments be documented through the system to ensure transparency and improve tracking of taxable income. The measures target both individual landlords and corporate property managers.
“Landlords are now required by law to issue Efris invoices whenever they receive rental payments,” a URA official said during a recent public awareness session. “This is a compliance measure that enhances monitoring and helps reduce tax evasion in the property sector.”
How Efris Invoices for Landlords Work
Under the new compliance measures, landlords must issue an electronic invoice for every rental transaction. URA officials said the system provides real-time records that enable authorities to cross-check declarations with actual revenue collected.
The URA has also urged landlords to integrate EFRIS into their accounting systems. The electronic platform connects directly to URA servers, automatically transmitting invoice data and providing confirmation of compliance.
Transition for Landlords
The shift to Efris invoices requires property owners to adapt to digital systems. The process includes internet access, basic computer literacy, and training to properly use the EFRIS platform.
URA has rolled out training sessions across major cities to guide landlords through the transition.
Some landlords alleged that the new system increases operational costs and technical demands. However, URA said it has provided ongoing support to minimise disruptions during implementation.
“The system is user-friendly, and we have established support centers to assist landlords in navigating the process,” a URA spokesperson said.
Penalties for Non-Compliance
URA officials confirmed that enforcement teams have been tasked with monitoring compliance in the rental sector.
According to URA, failure to issue Efris invoices to tenants may attract penalties, audits, or other enforcement actions. The penalties range from fines to potential legal action, depending on the scale of non-compliance. URA has emphasised that the directive is mandatory and applies across all categories of rental property.
Incentives for Adoption
In addition to enforcement, URA has introduced incentives for landlords who adopt Efris invoices early. These include reduced penalties for voluntary disclosure of undeclared rental income and credits for taxpayers who integrate their systems promptly.
Officials said these incentives are designed to encourage compliance before stricter enforcement measures are applied.
The URA has launched awareness campaigns to inform landlords and tenants about the importance of Efris invoices. Public notices, workshops, and media campaigns have been deployed to increase understanding of how the system works.
In Kampala, landlords have been summoned to compliance meetings where URA officials explained the use of EFRIS. Notices sent to property owners highlight the obligation to issue electronic invoices for every rental transaction.
“Tenants should also demand Efris invoices from landlords whenever they pay rent,” a URA compliance officer said. “This ensures that the system functions effectively, with both landlords and tenants playing their part.”
Strengthening Revenue Collection
The introduction of Efris invoices for landlords is expected to formalise Uganda’s rental sector, which has been difficult to regulate due to informal practices. URA data shows that rental income has historically been under-declared, limiting revenue collection from one of the fastest-growing property markets.
Officials noted that digital invoicing provides transparency and establishes a traceable system for transactions. This measure is aligned with Uganda’s broader strategy to expand its tax base and improve fiscal health.
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