VAT Guide to Value Added Tax - sri lanka inland revenue ...

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Services 1. Electricity more than 30 kwh, per month per consumer and bulk supply of electricity to the national grid. 2. Construction contractor’s or sub contractor’s services 3. Hotels, Guest Houses, Restaurants etc. and inbound tours 4. Exhibition of films or dramas 5. Liable educational services 6. Services provided by the Foreign Employment Bureau of Sri Lanka 7. Leasing facilities 8. Land transportation of goods 9. Services provided by qualified professionals and those who carry on specified vocations. 170
Appendix – I Comparison of the value of imported goods under GST and VAT Assume that the C.I.F value of goods imported is Rs.100/-, Customs Duty is levied at 25% ( & surcharge at 10%) and that the goods are not liable to Excise (special provisions) Levy and Cess. i. Under GST regime (prior to 01.08.2002) GST = (C.I.F + Cus Duty + Surcharge + Ex.Spl.Duty+ Cess) x 12.5 100 = (100 + 25 + 10 + 0 + 0) x 12.5 100 = 16.87 NSL = (C.I.F + Cus Duty ) x 125 x 6.5 100 100 In the Calculation of the NSL = (100 + 25 ) x 125 x 6.5 the surcharge on Customs Duty 100 100 is not taken into account = 10.15 ∴Total landed cost after taxes = CIF + Cus Duty + Surcharge + GST + NSL + (Excluding Stamp Duty) Ex.Spl.Duty+Cess = 100 + 25 + 10 + 16.87 + 10.15 + 0 + 0 = 162.02 ii. Under VAT Regime – (After 01.08.2002) VAT = (C.I.F + Cus Duty + Ex.Spl.Duty+ Cess) x 20 100 = (100 + 25 + 0 + 0) x 20 100 = 25 ∴Total landed cost after taxes = CIF + Cus Duty + VAT+ Ex.Spl.Duty + Cess (Excluding Port Development Levy) = 100 + 25 + 25 + 0 + 0 = 150 iii. Sale price to the Consumers If the importer is a registered person be should charge and collect VAT from the consumers to whom the imported goods are sold. But in deciding the sale price he need not take into account the GST or VAT paid to the Customs as it does not form part of his cost. 171
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But for the best to the September 0
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Preface The Value Added Tax Act was
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Chapter - 1 Introduction 1.1 Purpos
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However from the point of view of t
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The following test which has been a
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iv. Import of any fabric, yarn, gre
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Chapter - 3 The definitions of conc
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Eg. 1 : If “A” wants to termina
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c. Time of supply in relation to su
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Thus, any trade, business, etc. are
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a business in Sri Lanka and not to
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When the recipient is not a registe
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• There are two types of registra
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(ii) continued without making an ap
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(d) (e) (f) input credit has been c
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4.13 Activity Code Number “Suppli
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the H.S. classification it may be b
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5.8 Payment of tax on Assessments T
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5.11. Collection of VAT on Imports
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6.3 Approval For Deferment Facility
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iv. If an importer declares only pa
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6.6 Deferment on Local Supplies (Te
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7.4 Tax Invoice Tax invoice should
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7.11 Use of tax fraction to compute
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Lower Rate - 10% Goods and services
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Chapter - 9 Calculation of Tax 9.1
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accounted for in respect of all the
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transferred to a taxable activity a
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Eg. If A is an ice-cream vendor who
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(3) In the above case if the regist
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• claim (deduct) only the allowab
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• “Value of Supply” has to be
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VAT chargeable = 900,000 x 20% = 18
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• The Director General of Customs
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10.5.6 Milk - item (iv) • Liquid
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(i) Insurance - xi(i) • Only the
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in Sri Lanka and consumed in Sri La
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Chapter - 11 Refunds 11.1 Unlike in
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11.7 Set off of refunds against fut
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• To make an additional assessmen
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a genuine taxpayer who does not wis
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Penalties Tax payers should comply
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15.3 Keeping of records regarding e
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15.8 Example of a VAT Account VAT A
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the trading house or the other pers
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16.4 Concessions available to Expor
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v. Importation of services are not
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Chapter - 17 Hire Purchase Transact
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(a) Under the existing provisions V
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y the hire-purchase company to the
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Chapter - 18 Leasing & VAT 18.1 Lea
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installments. Any VAT not recovered
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18.13 Leasing inputs • Leasing in
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18.15 Leasing Advance Sometimes it
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Thus output tax of B on the termina
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Chapter - 19 Mortgages 19.1 Mortgag
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• Services provided by internatio
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Chapter - 21 Some Obligations Under
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However an adjusted figure must be
Page 120 and 121: Chapter 23 Construction Contracts 2
Page 122 and 123: Government agencies mentioned above
Page 124 and 125: Chapter - 24 Rulings 24.1 Following
Page 126 and 127: • None of the companies covered b
Page 128 and 129: which he has supplied to the garage
Page 130 and 131: instructions can be exempted if suc
Page 132 and 133: ii. iii. any other registration tha
Page 134 and 135: i. Membership fees and or subscript
Page 136 and 137: Chapter - 25 Zero Rated Supplies 25
Page 138 and 139: (ii) (iii) (iv) Services directly c
Page 140 and 141: Supply of facilities for crew chang
Page 142 and 143: 4. Yard to Port Transporting contai
Page 144 and 145: Chapter - 26 Travel Trade, Tourism
Page 146 and 147: ii. iii. But “travel insurance“
Page 148 and 149: 26.6 VAT ON MICE Tourism VAT rate a
Page 150 and 151: x. Supply of goods & vehicles free
Page 152 and 153: and for VAT purposes the two compon
Page 154 and 155: (i.e the lottery organizer) on whic
Page 156 and 157: The VAT charged on above should be
Page 158 and 159: 1.2.3 Other imported materials exce
Page 160 and 161: The sub-contract awarder should pay
Page 162 and 163: 2.3.1 Imported goods (except fabric
Page 164 and 165: 5.2.2 To BOI garment manufacturing
Page 166 and 167: Annexure - 2 First Schedule to the
Page 168 and 169: 4. Supply of any services to any Di
Page 172 and 173: Sale before 01.08.2002 - GST Regime
Page 174 and 175: GST = (CIF + CD + Surcharge + Ex.Sp
Page 176 and 177: to indicate the date of payment of
Page 178 and 179: The period within which the Board o
Page 180 and 181: Mrs. S.N.P. Abrew - Senior Assessor
Page 182: 182
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