Taxation of international executives
Source: Employees Provident Fund Act, No. 15 of 1958 as amended; Employees Trust Fund Act, No. 46 of 1980. Social Responsibility Levy which is administered by the Finance (Amendment) Act, No. 5 of 2005, Land (Restrictions and Alienation) Act No 38 of 2014.
Are there social security/social insurance taxes in Sri Lanka? If so, what are the rates for employers and employees?
|Type of insurance||Paid by employer||Paid by employee||Total|
|Employees' provident fund||12%||8%||20%|
|Employees' trust fund||3%||0%||3%|
Employers are required to contribute 12 percent of the relevant employee’s earnings and remit to the Employees’ Provident Fund (EPF). Earnings for this purpose means basic wage or salary plus all cost-of¬living and similar allowances and payments in respect of holidays, but not overtime payments. Contributions by the employees are made at 8 percent to the EPF.The above is the minimum contribution requirement.
All employers are required to contribute to the Employees’ Trust Fund (ETF). The statutory minimum contribution is 3 percent.
Are there any gift, wealth, estate, and/or inheritance taxes in Sri Lanka?
Are there real estate taxes in Sri Lanka?
Are there sales and/or value-added taxes in Sri Lanka?
Are there unemployment taxes in Sri Lanka?
Are there additional taxes in Sri Lanka that may be relevant to the general assignee? For example, customs tax, excise tax, stamp tax, and so on.
Stamp duty is levied on transfer of land and building on certain specified instruments prescribed in the law.
Is there a requirement to declare/report offshore assets (e.g., foreign financial accounts, securities) to the country’s fiscal or banking authorities?
As per the provisions in the new Foreign Exchange Act No. 12 of 2017, any person resident in Sri Lanka shall acquire foreign asset upto the specified limits and methods. Therefore, acquisition and maintenance of Foreign assets outside Sri Lanka is not prohibited however same is permitted subject to certain conditions.
Under the new Foreign Exchange regime, there is no such mandatory obligation to report off-shore assets. However, any property that has not been declared to the Commissioner General of Inland Revenue, or the Head of Department of the Inland Revenue, and not the property in respect of any court proceedings, shall only be liable to pay 1% of the remittance fee at the point of remittance. Therefore, such remittance will not be subject to any fee, surcharge, levy or penalty.
Also, the application of the Foreign exchange law is interlinked with the other laws governing the financial sector and financial crimes. This update is independent with regard to the application of other laws and does not reflect a indepth analysis of the application of the other local laws in Sri Lanka.
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