Kindly note that the Year of Assessment up to 2017/2018 have already time barred to ask for a refund through Return Amendment.(Section 200 of IR Act, No 10 of 2006) .Therefore we are of the view that you will not be able to claim such benefit for those years of assessment.
Further, You may need to refer the Section 59L of IR Act No .10 of 2006 (http://www.ird.gov.lk/en/publications/Income%20Tax_Documents/IR_Act_No_10[E]_2006_(Consolidation_2015).pdf -Page 135) to confirm whether your business is within the definition as per the section.If your business is within the definition, the Given exemption can be claimed for Y/A 2018/2019 onwards.
As per the Transitional Provisions(Gazzette No :No. 2064/53) such benefit can continue.
Refer https://www.taxadvisor.lk/data/uploads/order_under_sec_194_of_inland_revenue_act_that_the_regulations_of_transitional_provisions_no_2064_53.pdf
For the Y/A 2019/2020 following rates should be applied subject to 59L (50% benefit can be claimed)
-For First Nine Months
(b) in the case of a company predominantly conducting a
business of exporting goods and services
Dear Sir,
Your question is in the process of evaluating by the Chartered Accountants.Will let you know the answer during cource of the day.
Support Team
taxadvisor.lk
You are taxed as a non resident in Sri Lanka. Hence only income arising in or derived from SL is taxable in SL. However WHT deducted on Dividend is a final tax in Sri Lanka.
You are entitled to deduct personal relief of Rs. 500,000 (w.e.f.01.01.2020 Rs. 3,000,000) and balance income willbe be taxed at progressive rates. You may be able to get credit in USA if such income is taxed in USA also.
This is with reference to the question raised via our website and state the following.
OUR UNDERSTANDING OF THE TRANSACTION
The company has constructed a house for the director
Thank you for making an enquiry through our website.
To check the eligibility for the VAT registration, first we need to get an idea about the nature of the business activity that your company is engaging. Basically what does the company's turnover comprise.
Thank for you making an enquiry through our website. Accordingly, we give our opinion on the question raised as follows.
Income Tax
As you stated, since you are aware of the Withholding Tax (WHT), we are not focusing to the depth of the WHT matter. However, we give the implication of income tax as follows.
As there is a Double Tax Agreement (DTA) between Germany and Sri Lanka, in computing the income tax liability, the provisions of the DTA shall prevail. Accordingly, we give below implication each and every possible income which could arise from this transaction.
1. The profits and income from sale of software -This could arise in case where the software is sold outright (i.e transfer the exclusive right). In this connection no tax liability shall arise unless your company is carrying out business in Sri Lanka through a permanent establishment situated in Sri Lanka. Therefore, no WHT is applicable.
2. Profits and income from use or right to use of software - if your company is receiving consideration on use or right to use of software, this falls to the meaning of
In the case of provision of services, the NBT shall be charged only where such services are carrying out as a business and exceeded the liable threshold limit. However, in the case of rent, as the rent income is recurring nature, question arise as to how such income does not fall to the business.
Exemption on dividends under Sec. 10(1)(k) of Inland Revenue Act,No 10 of 2006 will not be applicable from 01.04.2018. hence, we are of the view that dividend declared after 01.04.2018 will be subject to WHT.
It is a business income.
Though it is not excluded from (SMEs) definition,we are of the view that the tax rate applicable to liquor business is 40%.