Sri Lanka tax
Tax residence: At least 183 days in any 12-month period commencing or ending during the year of assessment. Special regime for new residents: Investor Category Residence Visa holders: not a Sri Lankan resident.
Checked against official sources on Change log
Tax residence
- At least 183 days in any 12-month period commencing or ending during the year of assessment · Presence makes an individual resident
- Year of assessment runs from 1 April.
- Section 69(1) of the 2017 Act applies; the 2026 amendment changes section 69(1)(d) and adds 69(1A) only.
Special regimes for new residents
Special regime
Investor Category Residence Visa holders: not a Sri Lankan resident for income tax (s.69(1A))
Tax relief
Details
- On: Residence status for income tax: Sri Lankan-source gains and profits remain chargeable
An individual holding an Investor Category Residence Visa issued by the Controller of Immigration and Emigration is not a Sri Lankan resident for a year of assessment. Non-residents are charged income tax only on gains and profits arising or derived from Sri Lanka, so foreign-source income falls outside Sri Lankan income tax while the status applies. 1 2
Taxed on
Residence status for income tax: Sri Lankan-source gains and profits remain chargeable; foreign-source income is not charged to a non-resident.
Who it applies to
- Hold an Investor Category Residence Visa issued by the Controller of Immigration and Emigration for the year of assessment.
- Operative from 1 April 2025 (Inland Revenue (Amendment) Act No. 11 of 2026, section 9 inserting s.69(1A)).
Exclusions
- The Act does not say which of the investor options listed by the Immigration Department count as the Investor Category Residence Visa.
- Sri Lankan-source income remains taxable under non-resident rules.
Tax residence
Section 69(1A) overrides the general residence tests of s.69(1) for visa holders. Residents are chargeable on Sri Lankan and foreign-source income; non-residents on Sri Lankan-source gains and profits only (IRD).
Visas
Applies only to the Investor Category Residence Visa; digital nomad, employment, student and spouse visas are not covered by the provision.
Other taxes
VAT, withholding, exchange-control and home-country taxes are separate.
Checked against official sources on Change log
Which visas the regimes apply to
- Investor Category Residence Visa holders: not a Sri Lankan resident: Investor visa · General, Investor visa · Condo, Investor visa · Direct, Investor visa · Shares, Investor visa · Gov bonds. Applies only to the Investor Category Residence Visa; digital nomad, employment, student and spouse visas are not covered by the provision.
Standard rules and foreign-source income
Standard rules
Income tax: residents on worldwide income, non-residents on Sri Lankan-source income
Details
- On: Gains and profits from employment, business, investment and other sources
- Who: Residence is determined under the Inland Revenue Act, No. 24 of 2017, s.69
- Limit: LKR 1.8M/yr ≈ $5,440
A resident is chargeable on income from Sri Lanka and on foreign-source income (global income); a non-resident only on gains and profits arising or derived from Sri Lanka. From 1 April 2025 the rates on taxable income are 6% to LKR 1,000,000, (≈ $3,020) 18% to LKR 1,500,000, (≈ $4,530) 24% to LKR 2,000,000, (≈ $6,050) 30% to LKR 2,500,000 (≈ $7,560) and 36% above, after an aggregate personal relief of LKR 1,800,000 (≈ $5,440) for residents and citizens. 2 1 3 4
Taxed on
Gains and profits from employment, business, investment and other sources, after the personal relief; gains from realising investment assets are taxed at 10%.
Who it applies to
- Residence is determined under the Inland Revenue Act, No. 24 of 2017, s.69.
Exclusions
- Employees leaving Sri Lanka for foreign employment under a contract of at least one year with a non-associated employer are not residents from the first day of that year of assessment until the contract expires (s.69(2A), effective 1 April 2025).
- Gains from realising investment assets are taxed at 10%, outside the progressive scale.
Limits
- LKR 1,800,000 a year (≈ $5,440) · Aggregate personal relief for a resident individual, or a non-resident Sri Lankan citizen, for each year of assessment commencing on or after 1 April 2025.
- LKR 1,000,000 a year (≈ $3,020) · 6% on taxable income up to LKR 1,000,000 (≈ $3,020) (years of assessment from 1 April 2025).
- LKR 1,500,000 a year (≈ $4,530) · 18% on taxable income from LKR 1,000,001 (≈ $3,020) to LKR 1,500,000 (≈ $4,530).
- LKR 2,000,000 a year (≈ $6,050) · 24% on taxable income from LKR 1,500,001 (≈ $4,530) to LKR 2,000,000 (≈ $6,050).
- LKR 2,500,000 a year (≈ $7,560) · 30% on taxable income from LKR 2,000,001 (≈ $6,050) to LKR 2,500,000 (≈ $7,560); 36% above LKR 2,500,000 (≈ $7,560).
Tax residence
Year of assessment runs from 1 April.
Visas
Visa status does not determine residence, except the Investor Category Residence Visa rule in s.69(1A).
Other taxes
VAT and other levies apply separately. A digital nomad visa extension requires proof of registration with the Inland Revenue Department.
Checked against official sources on Change log
Standard rules
Sri Lanka: residents taxed on worldwide income
Worldwide income
Details
- On: Worldwide income of residents (Inland Revenue Act section 4(a))
- Limit: LKR 1.8M/yr ≈ $5,440
A resident individual in Sri Lanka (resident there, or present 183 days or more in any 12-month period commencing or ending in the year of assessment) is taxed on income from wherever it arises; non-residents are taxed only on Sri Lankan-source income. 5 6 7
Taxed on
Worldwide income of residents (Inland Revenue Act section 4(a)); income arising in or derived from Sri Lanka for non-residents (section 4(b)).
Who it applies to
- Individual resident for the year of assessment: resides in Sri Lanka, or is present for 183 days or more in aggregate in any 12-month period commencing or ending during the year, or is a Government employee whose spouse is posted abroad, or works on a Sri Lankan ship.
- Resident individuals, and citizens who are non-residents, receive an aggregate personal relief of LKR 1,800,000 (≈ $5,440) for years of assessment commencing on or after 1 April 2025.
Exclusions
- Holders of an Investor Category Residence Visa are not residents for a year of assessment (section 69(1A), effective 1 April 2025); see “Investor Category Residence Visa holders: not a Sri Lankan resident for income tax (s.69(1A))”.
Limits
- LKR 1,800,000 a year (≈ $5,440) · Personal relief for resident individuals and citizens, for years of assessment from 1 April 2025
Days in the country
- At least 183 days in any 12-month period commencing or ending during the year of assessment · Presence makes an individual resident
Tax residence
Section 69(1) of the 2017 Act applies; the 2026 amendment changes section 69(1)(d) and adds 69(1A) only.
Visas
The Investor Category Residence Visa is the only visa carved out of resident status by statute.
Other taxes
Progressive rates are in “Income tax: residents on worldwide income, non-residents on Sri Lankan-source income”; VAT and other levies apply separately.
Checked against official sources on Change log
VAT, social security and other taxes
- VAT, withholding, exchange-control and home-country taxes are separate.
- VAT and other levies apply separately. A digital nomad visa extension requires proof of registration with the Inland Revenue Department.
- Progressive rates are in “Income tax: residents on worldwide income, non-residents on Sri Lankan-source income”; VAT and other levies apply separately.
Questions people ask
When do you become a tax resident in Sri Lanka?
At least 183 days in any 12-month period commencing or ending during the year of assessment (Presence makes an individual resident). Year of assessment runs from 1 April.
Who qualifies for Investor Category Residence Visa holders: not a Sri Lankan resident?
Hold an Investor Category Residence Visa issued by the Controller of Immigration and Emigration for the year of assessment. Applies only to the Investor Category Residence Visa; digital nomad, employment, student and spouse visas are not covered by the provision.
How are Digital nomad visa holders taxed in Sri Lanka?
No special regime in our records is tied to the Digital nomad visa. The standard rules apply: A resident is chargeable on income from Sri Lanka and on foreign-source income (global income); a non-resident only on gains and profits arising or derived from Sri Lanka. From 1 April 2025 the rates on taxable income are 6% to LKR 1,000,000, (≈ $3,020) 18% to LKR 1,500,000, (≈ $4,530) 24% to LKR 2,000,000, (≈ $6,050) 30% to LKR 2,500,000 (≈ $7,560) and 36% above, after an aggregate personal relief of LKR 1,800,000 (≈ $5,440) for residents and citizens.
Is there a tax break for Investor visa · General holders in Sri Lanka?
Investor Category Residence Visa holders: not a Sri Lankan resident for income tax (s.69(1A)): An individual holding an Investor Category Residence Visa issued by the Controller of Immigration and Emigration is not a Sri Lankan resident for a year of assessment. It's separate from the visa and has its own conditions.
≈ USD figures are approximate: daily reference rates from ExchangeRate-API, dated 12 Oct 2026, refreshed when the site is updated.
Sources (7)
Official sources
- Inland Revenue (Amendment) Act, No. 11 of 2026 (certified 3 June 2026; gazetted 5 June 2026) · Parliament of Sri Lanka (published by Inland Revenue Department) · checked 2026-10-10 · published 2026-06-05
- Income Tax · Inland Revenue Department · checked 2026-10-10
- Digital Nomad Visa Category · Department of Immigration and Emigration of Sri Lanka · checked 2026-10-12
- Inland Revenue Act, No. 24 of 2017, consolidated text incorporating amendments up to 31 March 2025 (First Schedule, tax rates) · Inland Revenue Department, Sri Lanka · checked 2026-10-11 · published 2025-03-31
- Inland Revenue Act, No. 24 of 2017 (sections 4 and 69, original text) · Inland Revenue Department of Sri Lanka · checked 2026-10-10 · published 2017-10-24
- Income Tax · Inland Revenue Department of Sri Lanka · checked 2026-10-10
- Inland Revenue (Amendment) Act, No. 11 of 2026 · Inland Revenue Department of Sri Lanka · checked 2026-10-10