This is a one-time tax based on 2013/14 financial year as proposed in 2015 interim budget. The Finance Act of 2015 has already been amended to implemented this tax.
Who is liable:
Any individual or company who has a profit before income tax as per the audited accounts in excess of Rs.2 billion for the year of assessment 2013/14
Rate:
25% of taxable income for the Year of Assessment
Payment dates:
Payable in three equal installments staring on 31 Oct 2015
Other Considerations:
- In the case of group companies, the aggregate of the profits before income tax as per the audited accounts of all subsidiary companies and the holding company to be accumulated and the tax be paid if the aggregate sum exceeds the LKR 2 Billion threshold. Each company is obliged to pay the tax by due dates. In the event where any company has reported profit before income tax as per the audited accounts in excess of LKR 2 Billion but the aggregation results in a total less than LKR 2 Billion then it will still continue be liable on its own.
-Any changes in group structure or subsequent liquidations will not hinder the chargeability of anycompany.- In the case of BOI companies, the tax will be payable by any company whose Income Tax exemptionconferred upon by the BOI has ceased as of 1 April 2013. In such case alone, taxable income has been defined as “profit before income tax as per the audited accounts”.
- No consideration is granted in respect of any adjustment made to the Return of Income furnished or any additional assessment made, subsequently by such company or such individual.
- The tax shall be deemed to be expenditure in the financial statements pertaining to the Year ofassessment 2013/2014 and shall neither be deductible in computing the taxable income for any year of assessment nor allowed as a deduction in the computation of VAT on financial services and/or Nation Building Tax
