Tax Example: Rent

January 18, 2018

Non-resident couple's rental income1
Monthly Rental Income2 1,500 6,000 12,000
Annual Rental Income 18,000 72,000 144,000
Less Rates and Taxes3 (400) (400) 144,000
Less Repair (25%)4 (4,400) (17,900) 144,000
= Taxable Income 13,200 53,700 144,000
Income Tax5
flat rate 20% 2,640 10,740 21,540
Annual Income Tax Due 2,640 10,740 21,540
Other Taxes
Levy Social Responsibility 1% 26 107 215
Annual Income Tax Due 2,666 10,847 21,755
Tax due as % of Gross Income 14.81% 15.07% 15.11%
Thanks to:

Notes


1 The property is jointly owned by husband and wife, but then taxed separately (50% upon each partner).

2 Exchange rate used: 1.00 USD = 145.00 LKR

3 Estimated values only.

4 Repair allowance is limited to 25% of income after deduction of rates and taxes.

5 Rental income is taxed at a flat rate of 20%.

6 The Social Responsibility Levy (SRL) is computed as 1% of the annual income tax liability.

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