As enacted

Contents

10. Amendment of section 25 of the principal enactment

Official English translation. The Sinhala text prevails. Open the official Sinhala text, official PDF on documents.gov.lk

Section 25 of the principal enactment is hereby amended in subsection (1) of that section as follows:—

(1)

by the substitution for paragraph (b) of the proviso to paragraph (a) of that subsection, of the following paragraph :—

“(b)

where:—

(i)

any plant or machinery acquired is used in any business of providing health care, printing on paper, gem cutting and polishing, packaging of any commodity for commercial purposes, rice milling or such other business as may be prescribed by the Commissioner-General by Order published in the

Gezette; or

(ii)

the asset consists of a ship acquired on or after April 1, 2007, being a ship which is owned or chartered by a company registered under Part XI of the

Companies Act, No.7 of 2007 or is deemed to be a Sri Lanka ship by virtue of a determination made under paragraph (c) of section 30 of the

Merchant Shipping Act, No. 52 of 1971, the rate shall be 33 1/3 per centum of the cost of acquisition;”;

(2)

by the insertion immediately after paragraph (b) of the proviso to paragraph (a) of that subsection, of the following new paragraph :-

“(c)

where any plant or machinery is acquired on or after April 1, 2007 and is used in any business of carrying out construction work, the rate shall be twenty five per centum of the cost of acquisition;”;

(3)

in paragraph (e) of that subsection, by the substitution for the words “a sum equal to the bad debts incurred”, of the words and figures “for the year of assessment commencing on April 1, 2006, a sum equal to the bad debts incurred”; and

(4)

by the insertion immediately after paragraph (e) of that subsection, of the following new paragraphs :-

“(ee)

for any year of assessment commencing on or after April 1, 2007, a sum equal to the bad debts incurred by such person in any trade, business, profession, vocation or employment which have become bad debts during the period for which the profits are being ascertained :

Provided that, all sums recovered during such period on account of the amounts previously written off or allowed in respect of bad debts shall, for the purposes of this Act, be treated as receipts of that trade, business, profession, vocation or employment, for such period ;

(eee)

for any year of assessment commencing on or after April 1, 2007, where such person is a bank or a financial institution, such sum as the Commissioner-General considers reasonable for doubtful debts, to the extent that they are estimated to have become bad during the period for which the profits are being ascertained, and notwithstanding that such debts were due and payable prior to the commencement of that period :

Provided that :—

(i)

such sum so considered reasonable shall not exceed one per centum of the aggregate debts outstanding at the end of that period ;

(ii)

where the doubtful debts estimated by such person as having become bad during the period for which the profits are being ascertained exceeds the sum deducted under this paragraph, the excess shall be deemed to be doubtful debts estimated by such person as having become bad during the period immediately succeeding the period hereinbefore referred to ; and

(iii)

where the estimated amount of any doubtful debt previously allowed as a deduction has been reduced or such amount or any part thereof has been paid during such period, the sum by which such amount has been so reduced or the sum so paid shall for the purposes of this Act, be treated as a receipt of such bank or financial institution for that period.

For the purposes of this paragraph, “financial institution” shall have the same meaning as given for that expression in section 147 ;

(eeee)

for any year of assessment commencing on or after April 1, 2007, where such person is not a bank or a financial institution, such sum as the Commissioner-General considers reasonable for doubtful debts, to the extent that they are estimated to have become bad during the period for which the profits are being ascertained :

Provided that, where the estimated amount of any doubtful debt previously allowed as a deduction has been reduced or such amount or any part thereof has been paid during such period, the sum by which such amount has been so reduced or the sum so paid shall, for the purposes of this Act, be treated as a receipt of such person for such period.

For the purposes of this paragraph “financial institution” shall have the same meaning as given for that expression in section 147;”;

(5)

in paragraph (h) of that subsection, by the omission of the provisos to that paragraph ;

(6)

in the proviso to paragraph (k) of that subsection :—

(a)

by the substitution in paragraph (iv) of that proviso, for all the words and figures from “the trade, business, profession or vocation carried on by such employer.”, to the end of that paragraph, of the words, “the trade, business, profession or vocation carried on by such employer ; and”;

(b)

by the substitution in pargraph (v) of that proviso, for the words, “place of employment or vice versa;” , of the following words :—

“ place of employment or vice versa.

For the purpose of this proviso, “expenses incurred”, shall include any lease rental or other rental payment in respect of such vehicle or the cost of acquisition of such vehicle;”;

and

(7)

by the addition, immediately after paragraph (q) of that subsection, of the following paragraph :—

“(r)

the accreditation expenses, where such person is a person carrying on any profession.”.

Read on from s 11