New 15% Foreign Income Tax Rule in Sri Lanka 2025

If you earn in foreign currency and bring your money to Sri Lanka, you’re required to pay a 15% income tax on it with effect from 1 April 2025, the start of the year of assessment 2025/26. Until now, service providers working for foreign clients enjoyed a tax exemption. But with the latest changes, that exemption is gone.

What Does This Mean for You?

If you offer services to foreign clients and the payment for such services is received in foreign currency and remitted to Sri Lanka through a bank, you will be taxed as follows.

• This tax change applies to all individuals and businesses in IT, freelancing, BPO, KPO, and other service sectors.

• The tax is only on profits—not on the total amount you receive.

Try Our Foreign Income Tax Calculator

We’ve made it simple for you to check how much tax you’ll need to pay. Just:

1. Enter your monthly income in foreign currency.
2. Enter the exchange rate.
3. Get an instant tax estimate

This new tax rule is effective from February 1, 2025.

Important

• This calculator assumes you do not have any other sources of income or qualifying payments for easy understanding.
• The proposed personal relief of LKR 1,800,000 per year (LKR 150,000 per month) is considered.

If you have a mix of local and foreign income sources, call us at +94 77 106 6548 for assistance!