Sri Lanka — Payroll (APIT + EPF + ETF) — Skill v1.0

Produced by OpenAccountants (openaccountants.com). Research-grade (tier 2), drafted from official IRD / EPF / ETFB sources for YA 2025/26 — pending sign-off by a Sri Lankan CA / IRD-registered practitioner. Not tax advice.

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Section 1 — Quick reference: monthly payroll components

Component	Rate	Base	Paid by	Notes
APIT (PAYE)	Progressive (see APIT Table 01 in sri-lanka-income-tax)	Monthly regular employment profit, after LKR 150,000/month personal relief	Employee (withheld at source)	Top marginal 36% over LKR 358,333/month
EPF — employee	8%	Employee's total monthly earnings	Employee (deducted from salary)
EPF — employer	12%	Employee's total monthly earnings	Employer	EPF combined = 20%
ETF — employer	3%	Employee's total monthly earnings	Employer	Not deducted from employee; employer-only

Field	Value
Country / authority	Sri Lanka — IRD (APIT); EPF (Dept. of Labour / CBSL); ETF (ETF Board)
Currency	LKR
Year of assessment	1 April – 31 March
Personal relief (built into APIT Table 01)	LKR 150,000/month (LKR 1,800,000/year)
Validated by	Pending — Sri Lankan CA / IRD-registered practitioner
Skill version	1.0

Conservative defaults

Ambiguity	Default
EPF/ETF earnings base unclear (which allowances are "total earnings")	Include the allowance in the contribution base and flag — VERIFY which components are EPF-liable
APIT table selection unclear	Use Table 01 for regular primary-employment profits; flag for Tables 02/05/08 cases
Non-resident non-citizen employee	No personal relief; APIT as final withholding (see income-tax skill)

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Section 2 — Required inputs and refusal catalogue

Required inputs

Employer EPF/ETF registration numbers; employee total monthly earnings broken into basic + allowances; APIT table applicable (primary employment, lump sum, foreign-currency remote); residency/citizenship (drives relief); prior-month cumulative figures for APIT.

Refusal catalogue

R-LK-PAY-1 — EPF-liable earnings composition. Exactly which allowances form "total earnings" for EPF/ETF is governed by the EPF/ETF Acts and case law — this skill applies the contribution rates but does NOT assert the full EPF-liable earnings definition. VERIFY; escalate borderline allowance questions.

R-LK-PAY-2 — Surcharges / penalties for EPF/ETF default. Out of scope — escalate.

R-LK-PAY-3 — Gratuity, termination, ESOP. Separate treatment — escalate.

R-LK-PAY-4 — Cross-skill. Detailed APIT band logic → sri-lanka-income-tax; corporate/VAT/SSCL/WHT → respective skills.

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Section 3 — APIT (PAYE) withholding

APIT is the employer's monthly income-tax deduction. Do not redefine the bands here — pull APIT Table 01 from sri-lanka-income-tax. Summary of Table 01 (regular monthly primary-employment profit, YA 2025/26, relief LKR 150,000/month built in):

Monthly regular profit (LKR)	Tax
Up to 150,000	Nil (relief)
150,001 – 233,333	6% − 9,000
233,334 – 275,000	18% − 37,000
275,001 – 316,667	24% − 53,500
316,668 – 358,333	30% − 72,500
Over 358,333	36% − 94,000

Lump-sum payments use Table 02; resident remote workers for a foreign employer paid in forex use Table 08 (top 15%) — both in sri-lanka-income-tax. Source: IRD APIT 2025/26 tables.

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Section 4 — EPF and ETF

4.1 EPF (Employees' Provident Fund)

• Employee contribution: 8% of total monthly earnings (deducted from salary).
• Employer contribution: 12% of total monthly earnings.
• Combined EPF: 20% remitted to the fund.
• Source: EPF (epf.lk), CBSL Employees' Provident Fund.

4.2 ETF (Employees' Trust Fund)

• Employer contribution: 3% of total monthly earnings.
• Not deducted from the employee — the full 3% is borne by the employer.
• Source: Employees' Trust Fund Board (etfb.lk).

4.3 Earnings base

EPF/ETF are computed on the employee's total monthly earnings. Exactly which allowances are EPF/ETF-liable is governed by the EPF/ETF Acts — VERIFY the liable-earnings composition for any non-basic components.

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Section 5 — Worked example (illustrative)

Employee with total monthly earnings LKR 300,000 (assume all EPF-liable), resident, primary employment, YA 2025/26.

APIT (Table 01): 300,000 falls in 275,001–316,667 → 24% × 300,000 − 53,500 = 72,000 − 53,500 = LKR 18,500.

EPF: employee 8% × 300,000 = 24,000 (deducted); employer 12% × 300,000 = 36,000.

ETF: employer 3% × 300,000 = 9,000 (employer-only).

Item	LKR
Gross earnings	300,000
− APIT (PAYE)	(18,500)
− EPF employee (8%)	(24,000)
Net pay	257,500

Employer cost (parallel)	LKR
Gross earnings	300,000
EPF employer (12%)	36,000
ETF employer (3%)	9,000
Total employer cost	345,000

(EPF-liable base assumed = gross; confirm the liable composition.)

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Section 6 — Filing and remittance

• APIT: deducted monthly, remitted to IRD; reconciled in the employee's annual return.
• EPF / ETF: remitted monthly to the respective funds.
• Remittance due dates for APIT/EPF/ETF — VERIFY against the current IRD / EPF / ETFB schedules (not asserted here).

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Section 7 — Conservative defaults

Situation	Default
Allowance EPF-liability unclear	Include in base; flag
APIT table ambiguous	Table 01; flag for 02/05/08 cases
Remittance dates	Flag VERIFY
Any figure flagged VERIFY	Flag for reviewer

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Section 8 — Sources

1. IRD APIT tables YA 2025/26 — https://www.ird.gov.lk/en/publications/sitepages/apit_tax_tables.aspx
2. EPF (Employees' Provident Fund) — https://epf.lk/?page_id=811
3. CBSL Employees' Provident Fund — https://www.cbsl.gov.lk/en/employees-provident-fund
4. Employees' Trust Fund Board — https://etfb.lk/employers-faq/
5. Companion skill: sri-lanka-income-tax (APIT bands).

Known gaps / VERIFY: EPF/ETF-liable earnings composition; APIT/EPF/ETF remittance due dates.

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Prohibitions

• NEVER use an EPF rate other than employee 8% / employer 12% (combined 20%), or an ETF rate other than employer 3%, without confirming a rate change.
• NEVER deduct ETF from the employee — it is employer-only.
• NEVER redefine the APIT bands here — use sri-lanka-income-tax.
• NEVER assert EPF-liable earnings composition or remittance dates this skill flags as VERIFY.
• NEVER file or instruct filing — produce a working paper for practitioner review.

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Disclaimer

This skill and its outputs are for informational and computational purposes only and do not constitute tax, legal, or financial advice. All outputs must be reviewed and signed off by a qualified Sri Lankan professional (CA / IRD-registered tax practitioner, or payroll specialist) before any payslip is issued or remittance made. The latest verified version is maintained at openaccountants.com.

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