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openaccountants/skills/sri-lanka-vat.md
sri-lanka-vat.md214 lines8.0 KB
v20
1---
2name: sri-lanka-vat
3description: Use this skill whenever asked to prepare, review, or classify transactions for a Sri Lanka VAT return for any client. Trigger on phrases like "Sri Lanka VAT", "IRD return", "CGIR filing", or any request involving Sri Lanka VAT. MUST be loaded alongside vat-workflow-base v0.1 or later. ALWAYS read this skill before touching any Sri Lanka VAT work.
4version: 2.0
5---
6 
7# Sri Lanka VAT Return Skill v2.0
8 
9## Section 1 — Quick reference
10 
11| Field | Value |
12|---|---|
13| Country | Sri Lanka (Democratic Socialist Republic of Sri Lanka) |
14| Standard rate | 18% (effective 1 January 2024) |
15| Zero rate | 0% (exports, specified essential goods) |
16| Exempt | Financial services, healthcare, education, residential rent, unprocessed agriculture |
17| Return form | Monthly VAT return (via IRD e-filing) |
18| Filing portal | https://www.ird.gov.lk (IRD e-Services) |
19| Authority | Inland Revenue Department (IRD) |
20| Currency | LKR (Sri Lankan Rupee) |
21| Filing frequency | Monthly |
22| Deadline | Last business day of the month following the tax period |
23| Registration threshold | LKR 80 million per annum (or LKR 20 million per quarter) |
24| Companion skill | vat-workflow-base v0.1 or later — MUST be loaded |
25| Validated by | Pending local practitioner validation |
26 
27**Conservative defaults:**
28 
29| Ambiguity | Default |
30|---|---|
31| Unknown rate on a sale | 18% |
32| Unknown VAT status of a purchase | Not deductible |
33| Unknown counterparty location | Domestic Sri Lanka |
34| Unknown business-use proportion | 0% recovery |
35 
36---
37 
38## Section 2 — Required inputs and refusal catalogue
39 
40### Required inputs
41 
42**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.
43 
44### Sri Lanka-specific refusal catalogue
45 
46**R-LK-1 — BOI enterprise.** Trigger: client under Board of Investment agreement with tax holidays. Message: "BOI enterprises have bespoke tax exemptions. Please escalate."
47 
48**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)."
49 
50**R-LK-3 — Simplified VAT regime.** Trigger: client on simplified regime. Message: "Simplified VAT has different filing requirements. Please escalate."
51 
52---
53 
54## Section 3 — Supplier pattern library
55 
56### 3.1 Sri Lankan banks (fees exempt — exclude)
57 
58| Pattern | Treatment | Notes |
59|---|---|---|
60| BOC, BANK OF CEYLON | EXCLUDE for bank charges | Exempt |
61| PEOPLES BANK, PEOPLE'S BANK | EXCLUDE for bank charges | Same |
62| COMMERCIAL BANK, COMBANK | EXCLUDE for bank charges | Same |
63| HNB, HATTON NATIONAL | EXCLUDE for bank charges | Same |
64| SAMPATH, SEYLAN, NDB, DFCC | EXCLUDE for bank charges | Same |
65| NATIONS TRUST | EXCLUDE for bank charges | Same |
66| INTEREST, LOAN, REPAYMENT | EXCLUDE | Out of scope |
67 
68### 3.2 Government (exclude)
69 
70| Pattern | Treatment | Notes |
71|---|---|---|
72| IRD, INLAND REVENUE | EXCLUDE | Tax payment |
73| CUSTOMS, SRI LANKA CUSTOMS | EXCLUDE | Duty |
74| EPF, ETF | EXCLUDE | Employee provident/trust fund |
75| COMPANY REGISTRAR | EXCLUDE | Registration fee |
76 
77### 3.3 Utilities
78 
79| Pattern | Treatment | Notes |
80|---|---|---|
81| CEB, CEYLON ELECTRICITY | Domestic 18% | Electricity |
82| LECO | Domestic 18% | Electricity (Colombo) |
83| NWS&DB, NATIONAL WATER | Domestic 18% | Water |
84| SLT, SRI LANKA TELECOM, DIALOG, MOBITEL | Domestic 18% | Telecoms |
85| HUTCH, AIRTEL LK | Domestic 18% | Same |
86 
87### 3.4 Digital payments
88 
89| Pattern | Treatment | Notes |
90|---|---|---|
91| FRIMI, GENIE, IPAY | EXCLUDE for fees | Financial service |
92 
93### 3.5 SaaS and international services
94 
95| Pattern | Treatment | Notes |
96|---|---|---|
97| GOOGLE, MICROSOFT, META, AWS | Self-assess 18% | Non-resident |
98| ZOOM, SLACK, CANVA | Self-assess 18% | Same |
99 
100### 3.6 Payroll and exclusions
101 
102| Pattern | Treatment | Notes |
103|---|---|---|
104| SALARY, WAGES | EXCLUDE | Outside VAT scope |
105| OWN TRANSFER, INTERNAL | EXCLUDE | Internal |
106| DIVIDEND | EXCLUDE | Out of scope |
107| CASH WITHDRAWAL | TIER 2 — ask | Default exclude |
108 
109---
110 
111## Section 4 — Worked examples
112 
113### Example 1 — Standard domestic sale at 18%
114 
115**Input line:** `05.04.2026 ; COLOMBO TRADING PVT ; CREDIT ; Invoice LK-041 ; LKR 1,180,000`
116 
117**Reasoning:** Domestic. 18%. Net = LKR 1,000,000, VAT = LKR 180,000.
118 
119| Date | Counterparty | Gross | Net | VAT | Rate | Field | Default? | Excluded? |
120|---|---|---|---|---|---|---|---|---|
121| 05.04.2026 | COLOMBO TRADING | +1,180,000 | +1,000,000 | 180,000 | 18% | Output | N | — |
122 
123### Example 2 — Export, zero-rated
124 
125**Input line:** `15.04.2026 ; UK BUYER LTD ; CREDIT ; Tea export ; LKR 5,000,000`
126 
127| Date | Counterparty | Gross | Net | VAT | Rate | Field | Default? | Excluded? |
128|---|---|---|---|---|---|---|---|---|
129| 15.04.2026 | UK BUYER LTD | +5,000,000 | +5,000,000 | 0 | 0% | Zero-rated | N | — |
130 
131### Example 3 — Non-resident digital service
132 
133**Input line:** `18.04.2026 ; AWS ; DEBIT ; Cloud hosting ; LKR -60,000`
134 
135| Date | Counterparty | Gross | Net | VAT | Rate | Field | Default? | Excluded? |
136|---|---|---|---|---|---|---|---|---|
137| 18.04.2026 | AWS | -60,000 | -60,000 | 10,800 | 18% | Output + Input | N | — |
138 
139### Example 4 — Bank charges
140 
141**Input line:** `30.04.2026 ; BOC ; DEBIT ; Monthly charge ; LKR -1,000`
142 
143| Date | Counterparty | Gross | Net | VAT | Rate | Field | Default? | Excluded? |
144|---|---|---|---|---|---|---|---|---|
145| 30.04.2026 | BOC | -1,000 | — | — | — | — | N | "Exempt" |
146 
147---
148 
149## Section 5 — Tier 1 classification rules (compressed)
150 
151### 5.1 Standard rate 18% — Default for all taxable supplies (from 1 Jan 2024; previously 15%).
152### 5.2 Zero rate — Exports, specified essential goods.
153### 5.3 Exempt — Financial services, healthcare, education, residential rent, unprocessed agriculture.
154### 5.4 Input tax credit — Valid tax invoice with TIN required. Business purpose. Apportionment if mixed.
155### 5.5 Blocked input — Personal consumption, entertainment, passenger vehicles.
156### 5.6 Imports — VAT at 18% on CIF plus duty.
157### 5.7 Reverse charge — Non-resident services: self-assess 18%.
158### 5.8 Registration — Mandatory if turnover exceeds LKR 80M/year or LKR 20M/quarter.
159 
160---
161 
162## Section 6 — Tier 2 catalogue (compressed)
163 
164### 6.1 Vehicle costs — Default: 0%.
165### 6.2 Entertainment — Default: block.
166### 6.3 SaaS entities — Default: self-assess 18%.
167### 6.4 BOI enterprise status — Default: flag. Question: "BOI agreement in force?"
168### 6.5 SSCL interaction — Default: flag. Question: "Is SSCL currently in force?"
169### 6.6 Cash withdrawals — Default: exclude.
170 
171---
172 
173## Section 7 — Excel working paper template
174 
175Per vat-workflow-base Section 3, with Sri Lanka fields: Output 18%, Zero-rated, Exempt, Input domestic, Input imports, Net VAT.
176 
177---
178 
179## Section 8 — Bank statement reading guide
180 
181BOC, People's Bank, Commercial Bank exports CSV/PDF. LKR primary. Sinhala/Tamil descriptions possible. Internal transfers: exclude. Convert foreign currency at CBSL rate.
182 
183---
184 
185## Section 9 — Onboarding fallback
186 
187### 9.1 TIN — "What is your IRD TIN?"
188### 9.2 Filing period — Monthly. "Which month?"
189### 9.3 Industry — "What does the business do?"
190### 9.4 Exports — "Do you export?"
191### 9.5 BOI status — "Are you under a BOI agreement?"
192### 9.6 Credit brought forward — Always ask.
193 
194---
195 
196## Section 10 — Reference material
197 
198### Sources
1991. Sri Lanka Value Added Tax Act No. 14 of 2002 (as amended). 2. Inland Revenue (Amendment) Act. 3. IRD e-Services portal.
200 
201### Known gaps
2021. BOI enterprises refused. 2. SSCL status changes frequently. 3. Rate changed from 15% to 18% in Jan 2024 — verify for transitional periods.
203 
204### Change log
205- v2.0 (April 2026): Full rewrite to Malta v2.0 ten-section structure.
206 
207---
208 
209## Disclaimer
210 
211This 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.
212 
213The most up-to-date version is maintained at [openaccountants.com](https://openaccountants.com).
214 

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Use this skill whenever asked to prepare, review, or classify transactions for a Sri Lanka VAT return for any client. Trigger on phrases like "Sri Lanka VAT", "IRD return", "CGIR filing", or any request involving Sri Lanka VAT. MUST be loaded alongside vat-workflow-base v0.1 or later. ALWAYS read this skill before touching any Sri Lanka VAT work.

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