What state or local transfer, stamp or similar taxes are levied generally on sellers or buyers upon the "direct transfer" of real estate?


Transfer of property in Sri Lanka is liable for the payment of stamp duty at the rate of Sri Lanka Rupees Four (LKR 4/-) per LKR 100/-. This is payable by the buyer and payable to the Provincial Council of the relevant Province, where the property is situate.

Under the Finance (Amendment) Act No.8 of 2004 (the Principal Act being the Finance Act No.11 of 1963) no person who is not a citizen of Sri Lanka can acquire immovable property without the payment of a 100% tax. The amount of the tax is equivalent to the value of the property (ordinarily, the purchase price).

The 100% tax will apply to a transfer of immovable property to a company incorporated in Sri Lanka, if more than 25% of the issued shares in such Company are owned by persons who are non-citizens of Sri Lanka.

By Order made by the Minister of Finance and Planning published in Gazette Extraordinary No.1386/18 dated 30th March 2005, transfer of property of certain class or description specified in the Order has been exempted from the payment of the 100% tax. For example, any land, the ownership of which is transferred to an enterprise, to which the BOI has granted authorization in writing to set up on such land, a project for the construction of not less than hundred residential housing units, each constructed on land not exceeding ten perches, inclusive of appurtenant land, or a condominium property within the meaning of the Apartment Ownership Law No.11 of 1973 comprising not less than hundred units for residential or non-residential accommodation, provided that the total value of the land is met by inward remittances of foreign currency, is exempt from the 100% tax.