Sri Lanka Vat

Sri Lanka VAT Return Skill v2.0

General reference only. This skill is general tax/accounting reference material for AI-assisted workflows. It has not been reviewed for any specific person's facts, documents, elections, deadlines, residency, filing status, or local procedures. Do not rely on it to file, pay, amend, or take a tax position without review by a qualified professional in the relevant jurisdiction.

Section 1 — Quick reference

Conservative defaults:

Section 2 — Required inputs and refusal catalogue

Required inputs

Minimum viable — bank statement for the month. Acceptable from: BOC (Bank of Ceylon), People's Bank, Commercial Bank, HNB (Hatton National Bank), Sampath Bank, Seylan Bank, DFCC, NDB, Nations Trust, or any other.

Sri Lanka-specific refusal catalogue

R-LK-1 — BOI enterprise. Trigger: client under Board of Investment agreement with tax holidays. Message: "BOI enterprises have bespoke tax exemptions. Please escalate."

R-LK-2 — Social Security Contribution Levy (SSCL) interaction. Trigger: SSCL applies alongside VAT. Message: "SSCL is a separate levy that may affect pricing and compliance. Verify current status (SSCL was suspended/reintroduced periodically)."

R-LK-3 — Simplified VAT regime. Trigger: client on simplified regime. Message: "Simplified VAT has different filing requirements. Please escalate."

Section 3 — Supplier pattern library

3.1 Sri Lankan banks (fees exempt — exclude)

3.2 Government (exclude)

3.3 Utilities

3.4 Digital payments

3.5 SaaS and international services

3.6 Payroll and exclusions

Section 4 — Worked examples

Example 1 — Standard domestic sale at 18%

Input line: 05.04.2026 ; COLOMBO TRADING PVT ; CREDIT ; Invoice LK-041 ; LKR 1,180,000

Reasoning: Domestic. 18%. Net = LKR 1,000,000, VAT = LKR 180,000.

Example 2 — Export, zero-rated

Input line: 15.04.2026 ; UK BUYER LTD ; CREDIT ; Tea export ; LKR 5,000,000

Example 3 — Non-resident digital service

Input line: 18.04.2026 ; AWS ; DEBIT ; Cloud hosting ; LKR -60,000

Example 4 — Bank charges

Input line: 30.04.2026 ; BOC ; DEBIT ; Monthly charge ; LKR -1,000

Section 5 — Tier 1 classification rules (compressed)

5.1 Standard rate 18% — Default for all taxable supplies (from 1 Jan 2024; previously 15%).

5.2 Zero rate — Exports, specified essential goods.

5.3 Exempt — Financial services, healthcare, education, residential rent, unprocessed agriculture.

5.4 Input tax credit — Valid tax invoice with TIN required. Business purpose. Apportionment if mixed.

5.5 Blocked input — Personal consumption, entertainment, passenger vehicles.

5.6 Imports — VAT at 18% on CIF plus duty.

5.7 Reverse charge — Non-resident services: self-assess 18%.

5.8 Registration — Mandatory if turnover exceeds LKR 80M/year or LKR 20M/quarter.

Section 6 — Tier 2 catalogue (compressed)

6.1 Vehicle costs — Default: 0%.

6.2 Entertainment — Default: block.

6.3 SaaS entities — Default: self-assess 18%.

6.4 BOI enterprise status — Default: flag. Question: "BOI agreement in force?"

6.5 SSCL interaction — Default: flag. Question: "Is SSCL currently in force?"

6.6 Cash withdrawals — Default: exclude.

Section 7 — Excel working paper template

Per vat-workflow-base Section 3, with Sri Lanka fields: Output 18%, Zero-rated, Exempt, Input domestic, Input imports, Net VAT.

Section 8 — Bank statement reading guide

BOC, People's Bank, Commercial Bank exports CSV/PDF. LKR primary. Sinhala/Tamil descriptions possible. Internal transfers: exclude. Convert foreign currency at CBSL rate.

Section 9 — Onboarding fallback

9.1 TIN — "What is your IRD TIN?"

9.2 Filing period — Monthly. "Which month?"

9.3 Industry — "What does the business do?"

9.4 Exports — "Do you export?"

9.5 BOI status — "Are you under a BOI agreement?"

9.6 Credit brought forward — Always ask.

Section 10 — Reference material

Sources

1. Sri Lanka Value Added Tax Act No. 14 of 2002 (as amended). 2. Inland Revenue (Amendment) Act. 3. IRD e-Services portal.

Known gaps

1. BOI enterprises refused. 2. SSCL status changes frequently. 3. Rate changed from 15% to 18% in Jan 2024 — verify for transitional periods.

Change log

• v2.0 (April 2026): Full rewrite to Malta v2.0 ten-section structure.

Disclaimer

This skill and its outputs are provided for informational and computational purposes only and do not constitute tax, legal, or financial advice. All outputs must be reviewed by a qualified professional before filing.

The most up-to-date version is maintained at openaccountants.com.

Disclaimer

This skill and its outputs are provided for informational and computational purposes only and do not constitute tax, legal, or financial advice. Open Accountants and its contributors accept no liability for any errors, omissions, or outcomes arising from the use of this skill. All outputs must be reviewed and signed off by a qualified professional (such as a CPA, EA, tax attorney, or equivalent licensed practitioner in your jurisdiction) before filing or acting upon.

The most up-to-date, verified version of this skill is maintained at openaccountants.com. Log in to access the latest version, request a professional review from a licensed accountant, and track updates as tax law changes.

Source: OpenAccountants — open tax Guides for AI, reviewed by named CPAs/CAs/EAs. Quality: source-cited draft. For always-current figures and named-accountant backing, connect the OpenAccountants MCP server (openaccountants-mcp).