Paye Tax Rates Are Changing From Tomorrow!

[Crosswind]

PAYE tax (income tax) rates are changing from tomorrow onwards and it's a bit of a relief for the current PAYE payers.

CURRENT RATES:

Tax Slab (Rs.) Rate (%)

First Rs. 300,000 Nil

Next Rs. 400,000 5%

Next Rs. 400,000 10%

Next Rs. 400,000 15%

Next Rs. 500,000 20%

Next Rs. 500,000 25%

Next Rs. 500,000 30%

Balance @ 35%

NEW RATES:

Tax Slab (Rs.) Rate (%)

First Rs. 500,000 Nil

Next Rs. 500,000 4%

Next Rs. 500,000 8%

Next Rs. 500,000 12%

Next Rs. 500,000 16%

Next Rs. 1,000,000 20%

Balance @ 24%

For example, at the current rate, someone who earns 100,000 a month had to pay Rs 5,314 as income tax but from April onwards, it is Rs. 2,333

Inland Revenue website has the new tax tables online: http://inlandrevenue.gov.lk/publications/TaxTables/paye1112/PAYE1112_E.pdf

Also the bloody annoying DEBIT TAX on withdrawals from bank accounts, is no more from tomorrow.

[harshansenadhir]

  On 3/31/2011 at 10:13 AM, Crosswind said:

PAYE tax (income tax) rates are changing from tomorrow onwards and it's a bit of a relief for the current PAYE payers.

CURRENT RATES:

Tax Slab (Rs.) Rate (%)

First Rs. 300,000 Nil

Next Rs. 400,000 5%

Next Rs. 400,000 10%

Next Rs. 400,000 15%

Next Rs. 500,000 20%

Next Rs. 500,000 25%

Next Rs. 500,000 30%

Balance @ 35%

NEW RATES:

Tax Slab (Rs.) Rate (%)

First Rs. 500,000 Nil

Next Rs. 500,000 4%

Next Rs. 500,000 8%

Next Rs. 500,000 12%

Next Rs. 500,000 16%

Next Rs. 1,000,000 20%

Balance @ 24%

For example, at the current rate, someone who earns 100,000 a month had to pay Rs 5,314 as income tax but from April onwards, it is Rs. 2,333

Inland Revenue website has the new tax tables online: http://inlandrevenue.gov.lk/publications/TaxTables/paye1112/PAYE1112_E.pdf

Also the bloody annoying DEBIT TAX on withdrawals from bank accounts, is no more from tomorrow.

but they've taken off the paye tax subsidy which was there for housing loan interest component.

[nexus]

hey thanks for sharing Crosswind this is good news to us all

[Crosswind]

  On 3/31/2011 at 10:21 AM, harshansenadhir said:

but they've taken off the paye tax subsidy which was there for housing loan interest component.

The old process of opening a tax file and then filing returns for loan interests and life insurance is removed (for single income employees). But as far as I know there's a separate allowance introduced to mitigate this(which wasn't there until now). I have asked a tax consultant and I am waiting for his response. I'll confirm once I get it.

[slcamel]

Good News; Can put that amount to pump patrol and go on a trip once a month.

[ThilakR]

  On 3/31/2011 at 10:21 AM, harshansenadhir said:

but they've taken off the paye tax subsidy which was there for housing loan interest component.

That is not a problem dude. You have to wait ages to receive your refund.

Thilak

[harshansenadhir]

  On 3/31/2011 at 11:38 AM, ThilakR said:

That is not a problem dude. You have to wait ages to receive your refund.

Thilak

If the loan is hefty, then even after waiting for ages, there was a chance of refunding the entire amount you've paid as PAYE tax.

[Praveen]

  On 3/31/2011 at 10:13 AM, Crosswind said:

PAYE tax (income tax) rates are changing from tomorrow onwards and it's a bit of a relief for the current PAYE payers.

CURRENT RATES:

Tax Slab (Rs.) Rate (%)

First Rs. 300,000 Nil

Next Rs. 400,000 5%

Next Rs. 400,000 10%

Next Rs. 400,000 15%

Next Rs. 500,000 20%

Next Rs. 500,000 25%

Next Rs. 500,000 30%

Balance @ 35%

NEW RATES:

Tax Slab (Rs.) Rate (%)

First Rs. 500,000 Nil

Next Rs. 500,000 4%

Next Rs. 500,000 8%

Next Rs. 500,000 12%

Next Rs. 500,000 16%

Next Rs. 1,000,000 20%

Balance @ 24%

For example, at the current rate, someone who earns 100,000 a month had to pay Rs 5,314 as income tax but from April onwards, it is Rs. 2,333

Inland Revenue website has the new tax tables online: http://inlandrevenue.gov.lk/publications/TaxTables/paye1112/PAYE1112_E.pdf

Also the bloody annoying DEBIT TAX on withdrawals from bank accounts, is no more from tomorrow.

can you please explain how you calculated the two tax rates. because when i did the calculation it turned up to be 6250 and 3000. I want to know where i went wrong

[dinran]

  On 3/31/2011 at 10:13 AM, Crosswind said:

NEW RATES:

Tax Slab (Rs.) Rate (%)

First Rs. 500,000 Nil

Next Rs. 500,000 4%

Next Rs. 500,000 8%

Next Rs. 500,000 12%

Next Rs. 500,000 16%

Next Rs. 1,000,000 20%

Balance @ 24%

[/quote

the above figures are wrong!!

[Crosswind]

  On 3/31/2011 at 12:34 PM, dinran said:

  On 3/31/2011 at 10:13 AM, Crosswind said:

NEW RATES:

Tax Slab (Rs.) Rate (%)

First Rs. 500,000 Nil

Next Rs. 500,000 4%

Next Rs. 500,000 8%

Next Rs. 500,000 12%

Next Rs. 500,000 16%

Next Rs. 1,000,000 20%

Balance @ 24%

the above figures are wrong!!

Yup u are right. The tax free limit is 600,000 not 500,000. All other numbers are fine.

Tax Slab (Rs.) Rate (%)

First Rs. 600,000 Nil

Next Rs. 500,000 4%

Next Rs. 500,000 8%

Next Rs. 500,000 12%

Next Rs. 500,000 16%

Next Rs. 1,000,000 20%

Balance @ 24%

[Crosswind]

  On 3/31/2011 at 12:21 PM, Praveen said:

can you please explain how you calculated the two tax rates. because when i did the calculation it turned up to be 6250 and 3000. I want to know where i went wrong

Use the tax tables released by Inland Revenue. It's much easier and more accurate that way.

I have already posted the 2011/12 Tax table (new rates) in the first post.

Here is the 2010/11 tax table (using old rates). http://www.inlandrevenue.gov.lk/publications/TaxTables/paye0910/Table%201-%20Monthly%20Deductions.pdf

[bope]

Crosswind……. i got some refunds but now I think I am in the losing end from today. What’s this “separate allowance introduced to mitigate the housing loan interest” I have not heard any new about this. Pls provide details if you find anything on this.

Bope

[Batteries]

  On 3/31/2011 at 10:48 AM, slcamel said:

Good News; Can put that amount to pump patrol and go on a trip once a month.

Yes. But the government is planning to increase the petrol bill from first week off April. All the statue papers were saying this last week.So don't get your hopes up.

[Batteries]

This is how it happens,

Monthly Remuneration not exceeding

Rs. 50,000/-Nil

Monthly Remuneration exceeding Rs. 50,000/-,but not exceeding Rs. 91,667/- 4% of Monthly Remuneration less Rs. 2,000/-

Monthly Remuneration exceeding Rs. 91,667/-,but not exceeding Rs. 133,333/-8% of Monthly Remuneration less Rs. 5,667/-

Monthly Remuneration exceeding Rs. 133,333/-,but not exceeding Rs. 175,000/-12% of Monthly Remuneration less Rs. 11,000/-

Monthly Remuneration exceeding Rs. 175,000/-,but not exceeding Rs. 216,667/-16% of Monthly Remuneration less Rs. 18,000/-

Monthly Remuneration exceeding Rs. 216,667/-,but not exceeding Rs. 300,000/-20% of Monthly Remuneration less Rs. 26,667/-

Monthly Remuneration exceeding Rs. 300,000/- 24% of Monthly Remuneration less Rs. 38,667/-

[isurujosh]

i also have a housing loan and the tax direction used to save about 9,000 LKR per month in taxes. but now with the new tax table even without the tax direction i still have to pay only 800 LKR more in taxes. so the benefit in terms of lower percentages and brackets may sometimes mitigate the negatives of the new laws.

[vishkid]

For those of us who do not hv housing loans (thus not used the refund) - benefit would be obvious.

However some bosses are trying to take advantage of this by trying to incorporate this saving to annual increments!! The cretins!!!

Edited April 2, 2011 by vishkid

[slcamel]

  On 4/1/2011 at 7:29 AM, Batteries said:

Yes. But the government is planning to increase the petrol bill from first week off April. All the statue papers were saying this last week.So don't get your hopes up.

You are a Fortune Teller, you got it correct and they have increased it. All my Trips are cancelled

[c1nder]

  On 3/31/2011 at 10:31 AM, Crosswind said:

The old process of opening a tax file and then filing returns for loan interests and life insurance is removed (for single income employees). But as far as I know there's a separate allowance introduced to mitigate this(which wasn't there until now). I have asked a tax consultant and I am waiting for his response. I'll confirm once I get it.

Did you get the info from the tax consultant? I'm about to get a housing loan