Tax residency certificate, also known as, TRC certificate is the official proof of residency for tax purposes issued by the Inland Revenue Department, confirming that an individual or business is a tax resident in Sri Lanka.
A Tax Residency Certificate helps you claim DTAA benefits, reduce TDS (Tax Deducted at Source) and avoid double taxation on your pension, investment and foreign income. This certificate is essential for foreigners resident in Sri Lanka who need proof of tax residency to claim tax relief in their home country under DTAA provisions.
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Who is a tax resident in Sri Lanka?
A person is considered a tax resident if he or she is present in Sri Lanka for more than 183 days or more in a tax year.
Who can apply for a tax residence certificate in Sri Lanka?
Any person in Sri Lanka with a Tax Identification Number (TIN) can apply for tax residency certificate for the relevant tax year.
Before applying for a TRC, it’s essential to determine your Sri Lankan tax residency status depending on whether you are an individual, partnership, trust or company.
As per section 69 of the Inland Revenue Act No. 24 of 2017, the following individuals and entities are eligible to obtain a TRC in Sri Lanka.
Individual tax residence certificate
An individual is a tax resident if he or she
- Resides in Sri Lanka
- Is present in Sri Lanka during the tax year for 183 days or more
- Is an employee or an official of the government and spouse is posted abroad during the tax year
- Is employed on a Sri Lanka ship.
Certificate of residence company
A company is considered a tax resident in Sri Lanka if
- It is registered as a company in Sri Lanka or
- its principal office is in Sri Lanka or
- the management and control of the company’s affairs are exercised in Sri Lanka at any time during the tax year.
Partnership tax residence certificate
A partnership is a tax resident in Sri Lanka if:
- it is registered in Sri Lanka
- its management and control are carried out in Sri Lanka at any time during the tax year
Trust tax residence certificate
A trust is a tax resident in Sri Lanka if:
- It is established in Sri Lanka
- the trustee of the trust is resident in Sri Lanka at any time during the tax year
- a person resident in Sri Lanka directs the senior managerial decisions of the trust, either alone or jointly with others, directly or through interposed entities.
Documents required for tax residency certificate
To obtain a tax residency certificate, you should submit the following documents
- Request letter
- TIN Certificate
- Address verification document for the current address
- Copy of the Business Registration Certificate
- Scanned copy of National Identity Card/Passport
- Scanned copy of front page of the passport with all visa issued pages and pages of arrival and departure date stamps
- If a TRC has been already issued for a previous year, scanned copy of the certificate of residence.
Application for tax residency certificate
Request for certificate of tax residence should be made to the Commissioner of International Tax Affairs at the Secretariat Branch of the Inland Revenue Department via email with the required documents for tax residency certificate.
How long does it take to receive TRC certificate?
IRD issues the TRC within 2-3 working days after your application for tax residency certificate is submitted. You can collect the original TRC certificate from the Secretariat Branch of the IRD (14th Floor).
If someone is collecting the TRC on your behalf, you should provide a written authorization for them to do so.
What is the validity of TRC certificate?
A TRC has a validity period. A tax residency certificate is valid for the relevant tax year (commonly referred to as year of assessment) for which it is issued. The tax year commences on 1st April and ends on 31st March in the following year.
