Tax Payment 2019 dates at a glance

• Tax Free Allowance

LKR 500,000 for all sources of incomeAdditional tax relief of LKR 700,000 for employees only

• Rates of Tax – 2019/2020

Personal Income Tax

JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC

IT 15 15 15 30 15

ESC 18 18 19 18

VAT-Manufacturers 18 20 19 18 17 20 19 20 20 18 20 20

VAT-Others(i) 31 28 29 30 31 28 31 30 30 31 29 31

VAT-Others(ii) 14 15 15 11 15 14 15 15 12 15 15 13

FVAT 18 20 19 18 17 20 19 20 20 18 20 20

NBT 18 20 19 18 17 20 19 20 20 18 20 20

FNBT 18 20 19 18 17 20 19 20 20 18 20 20

PAYE 14 15 15 11 15 14 15 15 12 15 15 13

WHT 14 15 15 11 15 14 15 15 12 15 15 13

EPF/ETF 31 28 29 30 31 28 31 30 30 31 29 31

Stamp Duty 14 11 13 15

First 600,000 4

8

12

16

20

24

Next 600,000

Next 600,000

Next 600,000

Next 600,000

Balance

24,000

72,000

144,000

240,000

360,000

360,000+ 24%x Balance

Taxable Income (LKR)

Maximum Cumulative Tax (LKR)

Rate (%)

Interest paid to a resident person- other than senior citizen- senior citizens, if annual interest income exceeds LKR 1.5 Mn

5%

5%

14%

10%

14%

14%

Interest to non-resident person

Rent paid to a- resident person (>LKR 50,000 per month subject to LKR 500,000 per annum)- non-resident person

All other cases including non-resident person

Withholding tax on interest and rent

Rate (%)

5%

- 2018/2019 or 2018 - 2019/2020 or 2019

1st 15 days

from 16 day to month end

Tax facts at a glance

Choices.Priorities.Opportunities.

Terminal Benefits• Period of contribution - 20 years or less - First LKR 2,000,000 00% - Next LKR1,000,000 05% - Balance 10%

• Period of contribution – more than 20 years - First LKR5,000,000 00% - Next LKR1,000,000 05% - Balance 10%

• Terminal benefits include;- Commutation of a pension- Retiring gratuity- Compensation from loss of office approved by the CGIR- Provident fund not approved by the CGIR- Contribution to the Employee Trust Fund

Corporate Income Tax

• Small and Medium enterprises (Gross Income less than LKR 500 Mn, Not an associate entity)

• Company predominantly conducting a business of exporting goods & services

• Company predominantly conducting an agricultural business

• Company predominantly providing educational services

• Company predominantly engaged in an undertaking for the promotion of tourism

• Company predominantly providing information technology

• Persons engaged in betting & gaming, liquor or tobacco business

• Companies other than taxable at 40% and 14%

• Investment income

• On dividends distributed

• Remittance of profits

5% On business profits & income other than investment income

Rate (%)

Donation to specifiedinstitution Full None

40

28

28

14

14

14

14

14

14

14

14

Donations to approved charities providing institutional care for sick or needy

Aggregate of LKR 75,000 or 1/3 of taxable income, whichever is less (Individual)

LKR 500,000 or 1/5 of taxable income, whichever is less (Company)

None

Qualifying payments LimitationsCarry forward of anyunabsorbed balance

Value Added Tax (VAT)

Economic Service Charge (ESC)

• Standard rate – 15%

• Lower rate – 5% on timber

• Exports & specified international services - zero rated

• Registration threshold Liable turnover LKR 3 Mn per quarter or LKR 12 Mn per annum

• Payable by every buyer and seller on the turnover of every share trading transaction conducted through a stock exchange at 0.3% on the turnover.

Nation Building Tax (NBT)• 2% is payable by importers, manufacturers, service providers on their turnover, wholesalers & retailers on 50% of their turnover, and distributors on 25% of their turnover.

• Registration threshold Liable turnover LKR 3 Mn per quarter or LKR 12 Mn per annum.

Telecommunication Levy - 25%

Share Transaction Levy (STL)

• Buildings, structures and similar works of a permanent nature

• Vehicles, plants, equipments machinery, office furniture & fixtures, and any other depreciable asset not included in another class

• Computers and data handling equipment together with peripheral devices

• Intangible assets, excluding goodwill

Depreciation allowanceRate (%)

5

20

20

The actual useful life of the intangible asset, or where useful life is indefinite, 5

Liable turnover for ESC

Threshold for liable turnover

Quarterly turnover

LKR 12.5Mn per quarter

ESC set off from income tax Current year plus next two consecutive years

ESC rates - Standard

- Export of goods & services

0.5%

0.25%

Payments Quarterly

Return submission Annually