Tax in Sri Lanka

D. L. & F. De Saram

D. L. & F. De Saram has a superb tax practice that advises on a myriad of tax issues such as direct and indirect taxation and compliance matters as well as advising on other issues such as tax incentives and exemptions for investors. It is also rated for its work on double taxation issues and on the structuring of transactions in a tax efficient manner. It also garners praise for its work on various tax issues on cross-border deals. In addition, the team is well placed to represent clients in various tax disputes. Key members of the team are Savantha De Saram,  Prabash De Saram and Aloka Nandasena.

Key clients

Tesco International Sourcing Limited

Julius & Creasy

Julius & Creasy has a strong tax practice that frequently provides legal opinions to foreign clients on direct investments in the country as well as assisting its clients when they are restructuring their businesses. It is also adept at providing legal opinions on various subjects such as direct and indirect tax issues. In addition, it frequently assists clients on the implementation of foreign employee share plans/employee incentive plans when they are being implemented by companies outside of Sri Lanka. Other strengths lie in liaising with various regulatory authorities. Another area of expertise is advising entities outside Sri Lanka on any tax issues on aircraft transactions. Heads of team Anandhiy Gunawardhana and Diluka Rodrigo are both well-respected tax practitioners.

Nithya Partners

Nithya Partners has a strong reputation for its litigation advice and for its advice on direct and indirect taxes in Sri Lanka. It assists a number of high-profile clients in structuring their deals and is also skilled at representing clients in tax appeals before the Tax Appeals Commission and the court. The team under the leadership of Naomal Goonewardena is recommended too for its skill at representing clients in negotiations with various taxation authorities such as the Customs Department, the Excise Department and the Department of Inland Revenue. Another core focus of the practice is conducing tax due diligence audits.

Practice head(s):

Naomal Goonewardena

Testimonials

Naomal is the best tax advisor in the country‘.

Key clients

Seylan Bank PLC

Kegalle Plantations PLC

Lalan Rubber (Private) Limited

Ceylon Shell Flour (Private) Limited

Richard Pieris Rubber Compounds (Private) Limited

Boehm Leckner (Private) Limited

McLarens Lubricants (Private) Limited

CIC Agri Business (Private) Limited

Lanka Ashok Leyland PLC

Sathosa Motors PLC

Work highlights

  • Representing the client in an appeal which is pending before the Supreme Court and the Court of Appeal about an assessment which had been issued on the bank disallowing a certain proportion of its interest expense.  
  • Representing the client in an appeal which is pending before the Supreme Court with regard to an assessment which had been issued on the client on the basis that the sale of rubber trees by the client arising from the replantation program was not an ‘unprocessed agricultural product’ in order to qualify for a Value Added Tax (VAT) exemption under the Value Added Tax Act, No. 14 of 2002, as amended.
  • Represented the client in an appeal before the Court of Appeal about an assessment which had been issued on the client disallowing certain input credits for VAT purposes on the basis that there was a government subsidy on the sale of fertilizer and accordingly, a proportional part of the input credit should be disallowed.

Tiruchelvam Associates

Tiruchelvam Associates provides comprehensive tax advice to foreign and local clients and is adept at handling cross-border transactions. The team is well-versed in all aspects of direct and indirect tax and routinely advises corporates, not-for-profit entities, and individuals. The group is skilled at advising overseas clients that have a corporate presence in Sri Lanka on double taxation issues, tax issues on creating a permanent establishment in the country, and the taxation of foreign employees. It also represents clients at the Department of Inland Revenue and other bodies. Managing partner Ramani Muttettuwegama is the head of the department that has carved out considerable niche expertise in advising not-for-profit organisations on various structuring and operational matters. Associate Shanil Fernando is another key contact.

Practice head(s):

Ramani Muttettuwegama

Other key lawyers:

Shanil Fernando

Neelakandan & Neelakandan (formerly Murugesu & Neelakandan)

Neelakandan & Neelakandan (formerly Murugesu & Neelakandan) frequently advises domestic and international clients on tax structuring, direct and indirect tax as well as on double taxation issues. The agile team is adept too at advising clients on special exemptions that are granted by the regulatory authorities. In addition it routinely advises clients on the structuring of foreign direct investments in Sri Lanka. The team has also got substantial experience of representing clients in tax appeals before the Court of Appeal. Heads of  department Saravanan Neelakandan and Pranavan Neelakandan are the names to note.

Key clients

First Capital Treasuries Limited

Taisei Corporation (International) of Tokyo

Berendina Stichting Trust

Singer (Sri Lanka) PLC

Acuity Partners (Private) Limited

Orient Finance PLC

IWS Investment (Private) Limited

Malwatte Valley Plantation PLC

Softlogic Life Insurance PLC

Illukkumbura Industrial Automation (Private) Limited

Commercial Credit and Finance PLC

Natwealth Securities (Private) Limited

Work highlights

  • Continuing to advise First Capital Treasuries Limited  initially from the time the tax appeal was lodged with the Tax Appeals Commission and now to representing the client before the Court of Appeal.
  • Continuing to advise Taisei Corporation (International) of Tokyo on the tax implications arising out of the Bandaranaike International Airport Development Project.
  • Representing Softlogic Life Insurance PLC before the Court of Appeal in its contested appeal against the Tax Commission and instructing leading President’s Counsel in the matter.

John Wilson Partners

John Wilson Partners has a solid reputation for its work on tax treaties and it is adept at assisting clients on a wide range of transactional matters. It is also recommended for its work on double taxation issues, tax planning, VAT and customs duties. It receives a regular stream of instructions too on tax disputes. John Wilson leads the tax offering.

Practice head(s):

John Wilson

Key clients

Janatha Estates Development Board (JEDB)

Fragomen

Spectrum Brands

Buckingham Leisure Lanka

Alvarez & Marsal

Emergent Cold (Pvt) Ltd

Work highlights

  • Provided Emergent Cold (Private) Ltd with a due diligence report on the acquisition of Findlays Cold Storage (Private) Ltd.
  • Prepared a legal due diligence report for a foreigner who is in the process of securing/leasing 75 acres of land for 30 year tenure with the option to renew.