How is PAYE tax calculated in Sri Lanka?

Your annual gross employment income is reduced by the personal relief of LKR 1,800,000 (LKR 150,000 a month). What remains is taxed through progressive bands: 6% on the first LKR 1,000,000, then 18%, 24% and 30% on each subsequent LKR 500,000, and 36% on the balance. The annual figure is divided by twelve to give the monthly deduction. Only the portion falling inside each band is taxed at that band's rate — moving into a higher band never reduces your take-home pay.

What is the tax-free threshold in Sri Lanka?

LKR 150,000 a month, or LKR 1,800,000 a year. If your gross monthly salary from a single primary employment is at or below LKR 150,000, no APIT is deducted. This threshold rose from LKR 1,200,000 to LKR 1,800,000 a year on 1 April 2025 under the Inland Revenue (Amendment) Act No. 2 of 2025, and the 12% band was removed at the same time.

What is the difference between PAYE and APIT?

They are the same deduction. PAYE (Pay As You Earn) was renamed APIT (Advance Personal Income Tax) in 2020. Most employers, payslips and employees still say PAYE, and the Inland Revenue Department's own tables are titled APIT. Nothing about how it is calculated differs.

What is EPF and ETF in Sri Lanka?

The Employees' Provident Fund (EPF) is a retirement fund you and your employer both pay into: 8% of your gross salary is deducted from your pay, and your employer adds a further 12The Employees' Trust Fund (ETF) is a separate 3% paid entirely by your employer — nothing is deducted from you for ETF. Both are calculated on gross earnings, not on taxable income, and neither is affected by the personal relief.

How do I calculate my take-home salary in Sri Lanka?

Take your gross monthly salary, subtract the 8The employer's 12% EPF and 3% ETF are paid on top of your salary and never come out of it — including them in the deduction is the most common mistake in salary calculations.

Is EPF deducted before or after tax?

Neither reduces the other. APIT is calculated on your gross employment income after personal relief, and the employee EPF contribution is calculated separately on gross earnings. Your EPF contribution does not lower your taxable income.

What are the APIT tax rates for 2026/2027?

No rate change has been announced for the 2026/2027 year of assessment, so the table introduced on 1 April 2025 carries forward: LKR 1,800,000 personal relief, then 6% on the first LKR 1,000,000 of taxable income, 18%, 24% and 30% on each subsequent LKR 500,000, and 36% above LKR 4,300,000. Budget announcements can change this mid-year, so confirm against the Inland Revenue Department before using it for payroll.

Is Sri Lanka a tax-free country?

No. Sri Lanka charges personal income tax on employment income at progressive rates from 6% to 36%. There is a tax-free allowance — the first LKR 1,800,000 a year — but income above it is taxed.

Do I pay PAYE on a second job in Sri Lanka?

Yes, but at different rates. This calculator uses Tax Table No. 01, which applies to a resident employee's single primary employment. Secondary employment income is deducted under a separate table, and combining two incomes without accounting for that will understate what you owe. Check with your employer which table applies.

Does Sri Lanka tax foreign income?

Residents are taxed on income from Sri Lankan sources, and foreign-source income is treated separately with reliefs and exemptions that have changed several times in recent years. This calculator covers local employment income only. Foreign employment income, freelance income paid from abroad and remittances each have their own rules — take professional advice rather than relying on a salary calculator.

Is my salary information sent anywhere?

No. The calculation runs entirely in your browser in JavaScript. Your salary is never transmitted, stored or logged, there is no account, and the page keeps working if you disconnect from the internet after it loads.

When does Sri Lanka's tax year run?

From 1 April to 31 March. The 2026/2027 year of assessment covers 1 April 2026 to 31 March 2027, and 2025/2026 covers 1 April 2025 to 31 March 2026. Rates announced in a budget usually take effect from the start of a year of assessment.

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Reference

Sri Lanka APIT / PAYE Tax Tables

Every band and rate for the 2025/2026 and 2026/2027 years of assessment, shown both monthly and annually, with EPF and ETF alongside. Built to be printed or sent to payroll.

Source: Inland Revenue Department — APIT Tax Tables. Sri Lanka's tax year runs 1 April to 31 March.

Year of assessment 2026/2027

1 Apr 2026 — 31 Mar 2027

Personal relief LKR 1,800,000 a year (LKR 150,000 a month). Income at or below that is not taxed.

No rate change has been announced for the 2026/27 year of assessment, so the table introduced on 1 April 2025 carries forward. Confirm against the IRD before relying on it for payroll.

Annual taxable income

Annual income (LKR)	Rate	Tax on this band
0 — 1,800,000	0%	Nil
1,800,000 — 2,800,000	6%	60,000
2,800,000 — 3,300,000	18%	90,000
3,300,000 — 3,800,000	24%	120,000
3,800,000 — 4,300,000	30%	150,000
Above 4,300,000	36%	—

Monthly, as the IRD tables present it

Applied to monthly income after the LKR 150,000 relief.

Monthly taxable income (LKR)	Rate
First 83,333.33	6%
Next 41,666.67	18%
Next 41,666.67	24%
Next 41,666.67	30%
Balance	36%

Year of assessment 2025/2026

1 Apr 2025 — 31 Mar 2026

Personal relief LKR 1,800,000 a year (LKR 150,000 a month). Income at or below that is not taxed.

Annual taxable income

Annual income (LKR)	Rate	Tax on this band
0 — 1,800,000	0%	Nil
1,800,000 — 2,800,000	6%	60,000
2,800,000 — 3,300,000	18%	90,000
3,300,000 — 3,800,000	24%	120,000
3,800,000 — 4,300,000	30%	150,000
Above 4,300,000	36%	—

Monthly, as the IRD tables present it

Applied to monthly income after the LKR 150,000 relief.

Monthly taxable income (LKR)	Rate
First 83,333.33	6%
Next 41,666.67	18%
Next 41,666.67	24%
Next 41,666.67	30%
Balance	36%

EPF and ETF rates

Calculated on gross earnings, not on taxable income. Personal relief does not apply.

Contribution	Rate	Paid by
EPF — employee	8%	You (deducted from your salary)
EPF — employer	12%	Employer (on top of your salary)
ETF — employer	3%	Employer (on top of your salary)

Only the employee 8% reduces your take-home pay. The employer's 12% and 3% are a cost to the employer — counting them as deductions is the most common error in salary calculations.

Calculate my take-home pay Official IRD tables Print or save as PDF from your browser

Questions people ask

How is PAYE tax calculated in Sri Lanka?: Your annual gross employment income is reduced by the personal relief of LKR 1,800,000 (LKR 150,000 a month). What remains is taxed through progressive bands: 6% on the first LKR 1,000,000, then 18%, 24% and 30% on each subsequent LKR 500,000, and 36% on the balance. The annual figure is divided by twelve to give the monthly deduction. Only the portion falling inside each band is taxed at that band's rate — moving into a higher band never reduces your take-home pay.
What is the tax-free threshold in Sri Lanka?: LKR 150,000 a month, or LKR 1,800,000 a year. If your gross monthly salary from a single primary employment is at or below LKR 150,000, no APIT is deducted. This threshold rose from LKR 1,200,000 to LKR 1,800,000 a year on 1 April 2025 under the Inland Revenue (Amendment) Act No. 2 of 2025, and the 12% band was removed at the same time.
What is the difference between PAYE and APIT?: They are the same deduction. PAYE (Pay As You Earn) was renamed APIT (Advance Personal Income Tax) in 2020. Most employers, payslips and employees still say PAYE, and the Inland Revenue Department's own tables are titled APIT. Nothing about how it is calculated differs.
What is EPF and ETF in Sri Lanka?: The Employees' Provident Fund (EPF) is a retirement fund you and your employer both pay into: 8% of your gross salary is deducted from your pay, and your employer adds a further 12The Employees' Trust Fund (ETF) is a separate 3% paid entirely by your employer — nothing is deducted from you for ETF. Both are calculated on gross earnings, not on taxable income, and neither is affected by the personal relief.
How do I calculate my take-home salary in Sri Lanka?: Take your gross monthly salary, subtract the 8The employer's 12% EPF and 3% ETF are paid on top of your salary and never come out of it — including them in the deduction is the most common mistake in salary calculations.
Is EPF deducted before or after tax?: Neither reduces the other. APIT is calculated on your gross employment income after personal relief, and the employee EPF contribution is calculated separately on gross earnings. Your EPF contribution does not lower your taxable income.
What are the APIT tax rates for 2026/2027?: No rate change has been announced for the 2026/2027 year of assessment, so the table introduced on 1 April 2025 carries forward: LKR 1,800,000 personal relief, then 6% on the first LKR 1,000,000 of taxable income, 18%, 24% and 30% on each subsequent LKR 500,000, and 36% above LKR 4,300,000. Budget announcements can change this mid-year, so confirm against the Inland Revenue Department before using it for payroll.
Is Sri Lanka a tax-free country?: No. Sri Lanka charges personal income tax on employment income at progressive rates from 6% to 36%. There is a tax-free allowance — the first LKR 1,800,000 a year — but income above it is taxed.
Do I pay PAYE on a second job in Sri Lanka?: Yes, but at different rates. This calculator uses Tax Table No. 01, which applies to a resident employee's single primary employment. Secondary employment income is deducted under a separate table, and combining two incomes without accounting for that will understate what you owe. Check with your employer which table applies.
Does Sri Lanka tax foreign income?: Residents are taxed on income from Sri Lankan sources, and foreign-source income is treated separately with reliefs and exemptions that have changed several times in recent years. This calculator covers local employment income only. Foreign employment income, freelance income paid from abroad and remittances each have their own rules — take professional advice rather than relying on a salary calculator.
Is my salary information sent anywhere?: No. The calculation runs entirely in your browser in JavaScript. Your salary is never transmitted, stored or logged, there is no account, and the page keeps working if you disconnect from the internet after it loads.
When does Sri Lanka's tax year run?: From 1 April to 31 March. The 2026/2027 year of assessment covers 1 April 2026 to 31 March 2027, and 2025/2026 covers 1 April 2025 to 31 March 2026. Rates announced in a budget usually take effect from the start of a year of assessment.