Sri Lanka Flag

Sri Lanka: Taxes and Costs

Country Rating  » Star Rating Icon

Last Updated: Mar 12, 2007

High progressive income tax rates in Sri Lanka

Effective Tax Rate on Rental Income
Monthly Income US$1,500 US$6,000 US$12,000
Tax Rate 6.6% 19.6% 22.9%
Click here to see a worked example
Source: Grant Thornton Sri lanka Disclaimer

Rental Income

Nonresidents are taxed only on profits and income arising in, or derived from Sri Lanka. Rental income earned by nonresidents is taxed at progressive rates. Rates paid by the owners or the estimated annual rental value of the property as assessed by the local governments are deductible to arrive at the assessable income. Then, a standard deduction of 25% of the assessable income is given to all taxpayers earning rental or leasing income to account for income-generating expenses.

The personal tax rates are set at the following scale:

INCOME TAX
TAXABLE INCOME, PHP (US$) MARGINAL TAX RATE
Up to 300,000 (US$2,885) nil
300,000 – 500,000 (US$4,808) 10% on band over US$2,885
500,000 – 700,000 (US$6,731) 15% on band over US$4,808
700,000 – 900,000 (US$8,654) 20% on band over US$6,731
900,000 – 1,100,000 (US$10,577) 25% on band over US$8,654
1,100,000 – 1,600,000 (US$15,385) 30% on band over US$10,577
Over 1,600,000 (US$15,385) 35% on all income over US$15,38
Source: Global Property Guide

Capital Gains Tax

Capital Gains Tax (CGT) was abolished in April 2002.

 

Sri Lanka - more data and information

Your Comments

Be the first to comment!

Post a comment

Email address is kept strictly confidential
* Optional, but allows us to notify you when your comment has been posted.
Comments submitted using this form will be published.
Note that the editors cannot answer specific questions, e.g., about law or taxation.
These issues can be raised by posting publicly here, where often knowledgeable local readers are able to assist.



Subscribe to our Newsletter!

Enter your email address to sign up.