Case Study Uganda: Performance Incentives & NSSF Contributions

Do performance incentives form part of “wages” for NSSF calculation in Uganda?

In Uganda, performance incentives must be included in the wage figure used when calculating National Social Security Fund (NSSF) contributions.

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Supporting Legislation

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The requirement comes directly from Uganda’s National Social Security Fund Act, Cap 222.

Section 1 states that:‘ “Wages” means all emoluments which would be payable in cash to an employee under his or her contract of service if no deductions were made, whether in pursuance of any law requiring or permitting any deduction or otherwise.’‍
Section 11(1) states that employer contributions must be calculated on the total wages paid in that month.

“In Uganda, performance incentives form part of an employee’s ‘wage’ and must be included when calculating NSSF contributions.”

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Taken together, this means any cash payment due under the employment relationship, including performance incentives, forms part of ‘wages’ and must be included in the NSSF base.

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Employers should review all cash remuneration, including basic pay, allowances, incentives, and bonuses to ensure they are included in the wage total for NSSF purposes unless legislation explicitly excludes them.

𝘐𝘧 𝘢𝘯 𝘦𝘮𝘱𝘭𝘰𝘺𝘦𝘳 𝘩𝘢𝘴 𝘢𝘯𝘺 𝘶𝘯𝘤𝘦𝘳𝘵𝘢𝘪𝘯𝘵𝘺 𝘢𝘣𝘰𝘶𝘵 𝘸𝘩𝘦𝘵𝘩𝘦𝘳 𝘵𝘩𝘦 𝘢𝘣𝘰𝘷𝘦 𝘢𝘱𝘱𝘭𝘪𝘦𝘴 𝘵𝘰 𝘵𝘩𝘦𝘪𝘳 𝘦𝘮𝘱𝘭𝘰𝘺𝘦𝘦𝘴, 𝘪𝘵 𝘪𝘴 𝘳𝘦𝘤𝘰𝘮𝘮𝘦𝘯𝘥𝘦𝘥 𝘵𝘩𝘢𝘵 𝘭𝘦𝘨𝘢𝘭 𝘢𝘥𝘷𝘪𝘤𝘦 𝘣𝘦 𝘴𝘰𝘶𝘨𝘩𝘵.

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Uganda payroll

NSSF compliance

Wage definition Uganda

Tax Case Study Uganda

Deoné Ferreira

Tax Manager, Praxima