ird.gov.lk PAYE Pay As You Earn Tax : Sri Lanka Inland Revenue

Organization : Sri Lanka Inland Revenue
Type of Facility : PAYE Pay As You Earn Tax
Country: Sri Lanka

Website : http://www.ird.gov.lk/en/Type%20of%20Taxes/SitePages/Employer%20responsibilities%20(PAYE).aspx

Pay As You Earn Tax (PAYE):

In terms of Section 114 of the Inland Revenue Act No. 10 of 2006, Employers are required to deduct Income Tax on Employment Income of employees at the time of payment of remuneration.

Related : Sri Lanka Inland Revenue PAYE Income Tax Return : www.statusin.org/8975.html

For this purpose the Commissioner General of Inland Revenue specifies Tax Tables which are to be used in making such tax duductions. Since the Tax is paid at the time of earning the remuneration, This System is called Pay-As-You-Earn System (PAYE)

Payment of Tax:
Every employer has obligation to deduct PAYE tax from the Employee as per PAYE tax tables and the total deducted amount should remit to the department on or before 15th of the following month.

Furnishing PAYE Returns:
Due date :
Return of PAYE Tax (PAYE) for a relevant Assessment Year, should be furnished on or before 30th day of the month of April, of the following Assessment Year.

Submitted to :
Data Preperation & Revenue Accounting Unit (DPRAU) – 7th Floor of the IRD Building

Employer Responsibilities (PAYE) :
The Employers responsibilities under PAYE Scheme :
** Keep in safe custody the documents relating to every payment made to employees. Whenever officers authorized by the Commissioner General call for inspection, such documents should be made available to them. (Section 119)

** Remit to the Commissioner General every tax deduction made under PAYE Scheme during a month, not later than the 15th day of the month immediately following. (Section 120 (a)).

** Issue to all employees details of the tax deductions made during the year in the Certificate of Tax Deduction (T 10 form), before the expiry of the 30th day of April in the following year. (Section 120 (b)).
** Furnish Annual Declaration to the Commissioner General not later than 30th April every year. (Section 120 (d)).

** Be held responsible for recovery and/or remittance of taxes. Employers who fail to do so would be held personally liable to pay such amount. (Section 124 (1)).
** Pay in addition to the tax, a penalty of an amount not exceeding 50% of the tax, in case of a failure to deduct and/or remit the tax.

** In the following circumstances, the tax referred to in the table 6 should be paid in addition to the tax referred to in the Tables 1, 2, 4, 5and 7
** When an employer or any other person settles income tax of an employee, without it being deducted from his salary, or

** Reimbursement (by the employer) of income tax already deducted from employee’s salary and remitted to Inland Revenue Department.
** Required to contact the Commissioner PAYE or Secretariat, if it appears that in relation to any payment made to an employee, no tax table given in PAYE Tax Tables is applicable;? or if the employer requires any further clarification.??

For More Details:
PAYE Special Audit Unit – 0112134651
Computer Development Unit (CDU) – 0112134701/ 0112388518
Data Preperation & Revenue Accounting Unit (DPRAU) – 0112134751/ 0112328809
Secretariat -0112135413/ 0112338570