KAMPALA — The Uganda Revenue Authority (URA) has expanded mandatory use of its Electronic Fiscal Receipting and Invoicing Solution (EFRIS) to 12 business sectors, warning that companies could lose income tax deductions for expenses that are not supported by valid electronic invoices or receipts.
The expanded requirements apply retrospectively from July 1, 2025, meaning affected businesses are expected to ensure their transactions have complied with the electronic invoicing rules from that date.
EFRIS is URA’s digital system for issuing and transmitting electronic invoices and receipts, with transaction information sent to the tax authority in real time. URA says the system operates under Section 73A of the Tax Procedures Code Act.
The latest expansion moves beyond the earlier focus on VAT-registered taxpayers, bringing non-VAT-registered businesses in designated sectors into the mandatory EFRIS regime, subject to prescribed exemptions.
12 sectors affected
The sectors covered by the expanded mandate are: Wholesale and retail of fuel; Mining and quarrying; Manufacturing; Electricity, gas, steam and air-conditioning supply; Water supply, sewerage, waste management and remediation; Construction; Transportation and storage; Accommodation and food service activities; Information and communication technology; Real estate activities; Professional, scientific and technical activities; and Arts, entertainment and recreation.
The directive was effected through General Notice No. 2218 of 2025, published in the Uganda Gazette on July 25, 2025.
Businesses buying from affected suppliers also face new burden
The implications extend beyond businesses that are required to issue EFRIS documents.
URA’s position means that businesses purchasing goods or services from suppliers covered by the EFRIS mandate must obtain an electronic invoice or receipt where required. Failure to do so could affect the buyer’s ability to claim the expense as a deductible cost when calculating income tax.
A tax-sector publication citing the new requirements noted that where a buyer fails to obtain the required EFRIS invoice from a gazetted supplier, the expense may not be allowed as a deduction in the buyer’s income tax return, potentially increasing the amount of income tax payable.
This effectively places businesses under pressure to vet their suppliers and ensure they are issuing compliant EFRIS documents, rather than treating electronic invoicing as an obligation belonging only to the seller.
URA also wants buyer identification
Under the latest requirements, businesses are expected to capture the identity of buyers on fiscal receipts issued for commercial transactions.
The buyer may be identified using a Taxpayer Identification Number (TIN), Business Registration Number (BRN) or National Identification Number (NIN).
URA says the broader use of EFRIS is intended to strengthen documentation of business transactions, improve tax compliance and reduce opportunities for revenue leakage and fraudulent invoicing.
Small businesses exempt in some circumstances
The expanded requirements do not automatically mean every small operator must use EFRIS.
URA says taxpayers with annual sales turnover below Shs10 million are excluded from mandatory EFRIS use. Such taxpayers may nevertheless voluntarily use the EFRIS App or portal at no cost.
The authority has also previously acknowledged concerns about the cost and technical challenges of implementing EFRIS, particularly among small and informal businesses.
The expansion nevertheless represents a significant shift in Uganda’s tax administration, as EFRIS data increasingly becomes part of the documentation businesses need not only to prove sales, but also to substantiate expenses claimed for tax purposes.
Businesses affected by the directive are therefore expected to review their invoicing systems and transactions dating back to July 1, 2025, while companies buying from the gazetted sectors need to ensure that suppliers provide valid EFRIS invoices or receipts.