Tax on sale of property in Sri Lanka

GirlfromUK

Active member

Member since 27 October 2017

GirlfromUK

22 November 2018 06:23:31

GirlfromUK

22 November 2018 06:23:31

Hi guys,

My partner owns property in Sri Lanka. Neither he nor I hold Sri Lankan passports. He is of Sri Lankan descent. The land was a gift from his parents.

I know we can sell the property legally to a local.

Now my question is, do we have to pay tax on the profits made on the sale?

If yes, what percentage?

Thank you in advance for your replies.

B

Rathnavali

Member

Member since 22 May 2012

Colombo

Rathnavali

07 January 2019 13:54:50

Rathnavali

07 January 2019 13:54:50

Colombo

Yes, the Seller has to pay Capital Gains Tax on the sale of the property. CGT is 10% of the profit margin (that is; the difference between the sale price and the cost of the property as at 30.9.2017). Cost of the property is based on a valuation as at that date.
If the property subject to the sale is the principle place of residence of the seller and was owned by the seller continuously for the past 3 years from the date of the sale (and lived at for 2 years out of the said 3 years), then it is exempt from CGT.

Regards,
ARE