Nation Building Tax (NBT) Economic Service Charges ( ESC) Withholding Tax (WHT)

Transcription

1 Mahesh Ranawaka

2 Nation Building Tax (NBT) Economic Service Charges ( ESC) Stamp Duty Withholding Tax (WHT)

3 Scope.. Payable by every person (company, body of person, dealer or Partnership and individual) who.. Imports of any article Carries on the business of Manufacture of any article Providing a service of any description Wholesale and Retail of any

4 Legislation Act No. 9 of 2009 Effective from 1 st of February2009 Amendment Act. No. 32 of 2009 Amendment Act. No. 10 of 2011 Amendment Act. No. 09 of 2012 Amendment Act No. 11 of 2013

5 Chargeability Every liable person whose liable turnover for any quarter exceeds (i) Rs.3,000,000 per qtr from for Manufacturers, Service providers, Whole Sellers & Retail Sales traders

6 Chargeability Cont.. From Operating a Hotel, Guest house, Restaurant or other similar business, Supply of Labour (manpower),providing Educational services, etc... Turnover Exceeds 25 Mn for a Quarter Wholesale & Retail - 50% out of the liable turnover Distributors turnover - 25% out of the liable

7 Calculation of NBT Liable Turnover * 2% xxx Less: Tax Credits xxx Tax Payable xxx Less: Installments payable xxx Unabsorbed tax credit xxx xxx Balance Tax Payable xxx

8 Liable Turnover In the case of manufacturer, service provider, Dealer or Buying & Seller proceeds receivable whether received or not Other than Bad debts, VAT and Excise Duty In the case of importer the value of any article ascertained under section 6 of the Value Added Tax Act for the purpose of importation.

9 Tax Rates 1% - 01/02/ /04/ % - From 01/05/ /12/ % - Concessionary Rate From 01/07/2009 to 31/12/2010 (Only for local rice production) 2% - 01/01/2011 for all sectors

10 No refund will be made to any registered person but excess payment can be carried forward for setting off. Credit for NBT Only for Manufacturers Article imported Article purchased from the registered manufacturer Whole Sale / Retail, Service providers are not entitled for any credit for NBT paid by them. Refund

11 VAT Act Section 06 CIF value + Customs Duty + CESS + PAL + S. Excise any other duty payable to customs + 10% of the CIF value (mark up)

12 NBT Calculation % = X 2% = X 2% = X 2 % =

13 Return & Payment Return submit on 20 th dates of the month immediately succeeding the end of the relevant quarter. (Quarterly Basis) Payment Self payment on first two months and balance payment have to be paid on 20 th date of the month immediately succeeding the end of the relevant quarter.

14 Adjustment for Income Tax Gazette No. 1606/31 dated 09/06/2009 Y. A 08/09 No adjustment allowed 09/10 2/3 payable not (w.e.f. 1/05/2009) 10/11 2/3 payable for first 09 month not allowed 11/12 Fully allowed

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16 Charge based on Turnover of the business from 2006/07 on ward

17 Legislation Economic Service Charge (ESC) Act No. 13 of 2006 & Economic Service Charge Amendment Acts No. 15 of 2007 No. 11 of 2008 No. 16 of 2009 No. 11 of 2011 No. 06 of 2013

18 Liability of ESC Tax should be paid on liable turnover. Liable threshold for ESC is Rs.50Mn per Quarter. Tax Rate is 0.5% of the turnover.

19 Calculation of Tax = Liable Turnover * 0.5%

20 Liable Turnover For ESC The amount receivable, whether actually received or not from every transaction entered into within the relevant quarter with regard to the trade, business, profession or vocation carried after deducting the following amount. VAT included in the turnover Proceeds of the sale of capital assets. Bad debts (bad debt recoveries shall taken)

21 Payments & Returns of ESC Payments, 1 st Quarter 20 th July 2 nd Quarter 20 th October 3 rd Quarter 20 th January 4 th Quarter 20 th April Return, Annual Return - 30 th April (Annual Basis)

22 Exemption from ESC The turnover from the following businesses will be exempt from ESC. Distributors as defined in the ESC Act Dealers in Lottery Unit Trust or Mutual Fund All Air Lines & Shipping Lines Life Insurance Premium 22

23 Sett off against Income Tax Amount paid as ESC on the turnover which can be set off against the income tax liability within 5 years of assessment From the year of assessment in which such ESC payment made

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25 Govr. was abolished in 2002 and reintroduced in Stamp Duty (Special Provision)Act No.12 of 2006 with effected on Tax charge by the Provincial Council, Revenue authority. If Assessor is opinion that an instrument has not been duly stamped, he shall issue a notice assessing the amount of understated Stamp Duty

26 Who shall pay Payable by, In the case of a policy of Insurance, person effecting the insurance. In the case of a transfer or assignment of any share, transferee or assignee of such share. In the Case of Leasing, Lessee. In the case of claim, demand or request by service provider of credit card, card holder.

27 Stamp Duty. Affidavit Policy of Insurance Notary Warrant Credit Card Mortgage Issue, Transfer or Assignment of RS.25 Rs.o.50 for each 1000 Rs.1000 any shares 1000 Receipt or discharge given Up to Rs. 25,000 Rs. 10 for every 1000 Rs.1 for every 1000 Rs. 5 for every Exempt Above Rs. 25,000 Rs. 25

28 PAYE on employment Benefit PAYE on Director Fee Rs or below 10% Rs. 25,000 or above 16% 10% on Rent Income 10% on Winning from Lottery ( Amount more than 500,000) WHT on Interest Income

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