Inland Revenue Act 2006 · As enacted · Chapter XI · Special Cases a – Children
101. Ascertainment of income of clubs, trade associations etc.
Official English translation. Where it differs from the Sinhala or Tamil text, the Act itself says which text prevails.
Official translationFrom Department of Government Printing, unchanged
Where a body of persons, whether corporate or unincorporate, carries on a club or similar institution and receives from its members not less than three-fourths of its gross receipts on revenue account (including entrance fees and subscriptions), it shall not be deemed to carry on a business; but where less than three-fourths of its gross receipts are received from members, the whole of the income arising from transactions both with members and others (including entrance fees and subscriptions) shall be deemed to be receipts from a business, and the body of persons shall be liable to income tax in respect of the profits therefrom and in respect of the income which would be assessable, if it were not deemed to carry on a business.
Where a body of persons, whether corporate or unincorporate, carries on a trade association, chamber of commerce or similar institution in such circumstances, that more than half its receipts by way of entrance fees and subscriptions are from persons who claim or would be entitled to claim that such sums were allowable deductions for the purpose of section 25, such body of person shall be deemed to carry on a business, and the whole of its income from transactions both with members and others (including entrance fees and subscriptions) shall be deemed to be receipts from a business, and the body of persons shall be liable to income tax either in respect of the profits therefrom or in respect of the income which would be assessable, if it were not deemed to carry on a business, whichever is the greater.
In this section, “members”, in relation to a body of persons, means those persons who are entitled to vote at a general meeting of the body which exercises effective control over its affairs.
Nothing in this section shall be read and construed as affecting any exemption granted under Chapter III.
The provisions of Chapter X shall not apply to any body of persons which is a body corporate and which is assessable for income tax under this section.
Chapter XII
Chapter XIII
Payment of Tax by Self-Assessment
Chapter XIV
Deduction of Income Tax from Remuneration of Employees by Employers
Chapter XV
Provisions Relating to the Payment of Income Tax by a Government Institution
Chapter XVI
Deductions from Interest Paid by Banks and Financial Institutions
Chapter XVII
Deduction of Income Tax from Specified Fees Paid by Specified Persons
Chapter XVIII
Chapter XIX
Chapter XX
Deduction of Income Tax from Any Annuity or Royalty Paid or Any Management Fee Paid or Similar Payment Made by Any Person or Partnership
Chapter XXI
Retention of Moneys in Certain Provident Funds
Chapter XXII
Assessments
Chapter XXIII
Appeals A-Appeals to the Commissioner-General
Chapter XXIV
Finality of Assessments and Penalty for Incorrect Returns
Chapter XXV
Tax in Default and Sums Added Thereto
Chapter XXVI
Recovery of Tax
Chapter XXVII
Miscellaneous
Chapter XXVIII
Repayment
Chapter XXIX
Penalties and Offences
Chapter XXX
Administration
Chapter XXXI
General
Chapter XXXII
Interpretation
Chapter XXXIII