Income tax, social security and wages

Employee rights in Sri Lanka

Before entering the workforce, there are a few things foreigners may need to get used to, such as an undetermined, but fair, minimum wage.

“The Inland Revenue Act provides the legal authority to charge, levy and collect income tax on the profits and income of every person, which arose or is arising to such person for every year of assessment commencing on or after 1st of April, 2006.” (http://www.ird.gov.lk/it.html )

Taxpayer Identification Number (TIN)

When earning an income in Sri Lanka, you must register for a TIN. How-to directions and a downloadable application form is available on the Sri Lanka Inland Revenue website .

For employed foreigners who are deemed non-residents of Sri Lanka, only the profits and income derived or earned in Sri Lanka is eligible to be charged with income tax. 

Social security

According to the International Labour Organization (ILO), Sri Lanka has a fairly high level of social protection for its populace, but there are concerning gaps, such as the absence of an unemployment protection scheme, leaving some areas with little, or no social security coverage at all. 

Despite that, there are schemes developed for the following:

For more information on social security benefits in Sri Lanka, please refer to the following websites:

Minimum wage

In Sri Lanka, there is no fixed minimum wage for every person employed in the country, however, no worker in Sri Lanka can be paid less than a mandatory minimum rate of pay. This is determined by the trade of which the worker is employed.

Two main rules determine the pay and fixed wages of Sri Lanka’s workers:

Wages are also determined by:

Employees in Sri Lanka may be paid on a daily, weekly, biweekly or monthly basis, although a wage period cannot exceed one month.


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