56. Amendment of the Sixth Schedule to the principal enactment

Official English translation. The Sinhala text prevails.

The Sixth Schedule to the principal enactment is hereby amended as follows: -

(1)

by the repeal of paragraph 2 of that Schedule;

(2)

in paragraph 3 of that Schedule, by the substitution for the words “three years”, of the words “six years”;

(3)

in paragraph 8 of that Schedule, by the substitution for the words and figures “section 15, for three years”, of the words and figures “section 15, during the period of five years”;

(4)

by the insertion immediately after paragraph 8 of that Schedule, of the following new paragraphs:-

“Rate of Interest

9. Notwithstanding anything to the contrary in subsection (1) of section 159, the rate of

Act, No. 10 of 2021

interest for any payment due and payable during the period from March 1, 2020 to September 30,

2020 under this Act, shall be zero percent.

Marketing and Communication Expenses

10. (1) Subject to subparagraph (2), a person shall be entitled to an additional deduction when calculating his income from business for a year of assessment, equal to 100% of the total amount of marketing and communication expenses deducted under section 15A during the three years of assessment commencing from April 1,

2021.

(2)

The additional deduction under subparagraph (1) shall be made subject to the following conditions: -

(a)

the payment shall be made to a person who is not an associated person of the tax payer;

(b)

internal marketing expenses, salaries of marketing staff, expenditure on maintaining an internal marketing department, expenditure on corporate social responsibility initiatives and foreign travel expenses shall not be considered for the purpose of the additional deduction under subparagraph (1);

(c)

expenditure shall be attributable to goods and services with 65% of local value addition, the mode of calculation of which shall be as specified by the

Commissioner-General;

Act, No. 10 of 2021

(d)

the total additional deduction under subparagraph (1) shall not exceed

Rs. 500,000,000 in any year of assessment;

(e)

the Commissioner-General shall specify the requirements to maintain records, source documents and underlying documents for the purpose of subparagraph (1), in addition to the requirements of other sections of this Act.

Financial Cost

11. Subject to the provisions of this Act, financial cost incurred (other than such amounts, of which deductions is denied in previous years)

during the year of assessment commencing on

April 1, 2021, shall be deducted irrespective of the limit referred to in subsection (2) of section

18. That year of assessment shall not be recognized for the purpose of six years period referred to in subsection (3) of section 18.”.

Read on from s 57