The Inland Revenue Department has announced that individuals earning less than Rs. 1.8 million annually can now claim relief on the Advance Income Tax (AIT) charged on interest and discounts from deposits.
To benefit from this relief, eligible individuals must submit a self-declaration to their respective banks or financial institutions. As per the directive, financial institutions must implement a 10 percent reduction in AIT on interest and discounts payable to depositors, effective from today (01).
Key Tax Revisions Effective Today
Advance Income Tax (AIT) Relief
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AIT on interest, discounts, and Islamic financial transactions has been set at 10 percent.
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Individuals with annual assessable income below Rs. 1.8 million can reclaim AIT by submitting a self-declaration.
Personal Income Tax Adjustments
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The taxable monthly income threshold has been increased from Rs. 100,000 to Rs. 150,000, easing the tax burden on lower-income earners.
New Tax on Foreign Service Income
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A 15 percent tax has been introduced on income from services provided to foreign countries under amendments to the Inland Revenue Act.
Stamp Duty on Leases and Rentals Doubled
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Stamp duty on lease and rental agreements has increased from Rs. 10 to Rs. 20 per Rs. 1,000 or part thereof, as confirmed by the Ministry of Finance.
These changes aim to provide tax relief for lower-income individuals while adjusting tax regulations to align with the government’s fiscal policies.
