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

Chapter – 8
Returns and VAT Rates
8.1 VAT Returns
• As stated in para 3.6 returns are to be furnished either monthly or quarterly.
• If a person is not making 100% zero rated supplies, he will be treated as a
person required to submit monthly returns, if his zero rated supplies exceeds
50% of the total taxable supplies (including zero rated supplies) or if he is in the
deferment scheme. Position will be reviewed once in 6 months to check
whether he continues to be in that category.
• Returns must be furnished within one month of the last day of the taxable period.
• The quarterly tax payers should submit a return for GST for the month of July
2002 and a VAT return for the two months August and September, 2002.
• The registered persons who should furnish monthly returns are enumerated in
para 3.6. Zero Rated Supplies are given in Chapter 25.
• The return is in triplicate. Original is for the Department. First copy is for the
Bank. Second copy is for the tax payer.
8.2 Where to submit the return ?
• If tax is payable - return must be submitted to an assigned branch of Bank
of Ceylon with the remittance. The bank will retain the
original and the bank copy. You will be given the 2 rd copy.
• If tax is not payable – return must be submitted to the VAT Branch of the Dept.
8.3 Tax Rates
There are 3 rates and a special rate namely
Zero Rate (0%)
Lower Rate (10%)
Standard Rate (20%)
Zero rate :
• Export of goods and
• supply of services in Sri Lanka to be consumed outside Sri Lanka including repair
of ships, international transportation etc. as enumerated in Section 7(I)(b)
are zero rated (Section 7)
The list of zero rated supplies of goods and services is given in Chapter 25
49