Income tax is charged on the basis of the provisions under the Inland Revenue Act, No. 24 of 2017 as amended by the Inland Revenue (Amendment) Act, No. 10 of 2021. The Inland Revenue Act provides the legal authority to charge, levy and collect income tax on the gains and profits of every person, which arose or is arising to such person for every year of assessment commencing after 1st of April, 2018.
In respect of a person who is deemed to be resident in Sri Lanka is chargeable with income tax in respect of his income from Sri Lanka and income derived by him from outside Sri Lanka. The liability to income tax therefore extends to his global income. A person who is deemed to be non-resident in Sri Lanka is chargeable with income tax in respect of only the gains and profits, arising or derived from Sri Lanka.
An individual, who is a
resident in Sri Lanka for a year of assessment or who is a
non- resident in Sri Lanka for a year of assessment,
but is a citizen of Sri Lanka, will receive an aggregate relief of;
except that an individual who is a trustee, receiver, executor or liquidator shall not be entitled to deduct this personal relief as such trustee, receiver, executor or liquidator, and the relief shall not be deducted against gains from the realisation of investment assets.
Income Tax is payable on self-assessment basis, a person who is an “instalment payer” shall pay tax by quarterly instalments.
Inland Revenue Department, Sri Lanka,
Chittampalam A. Gardiner Mawatha, Colombo 02.
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