Sri Lanka: Guidance on risk-based refund scheme under VAT law

New framework and transitional  provisions for scheme

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October 6, 2025

The Inland Revenue Department (IRD) issued the regulation on the introduction of the risk-based refund scheme under Section 22 (5) (f) of the Value Added Tax (VAT) Act No 14 of 2002, which is effective from October 1, 2025.

The new framework and transitional provisions are detailed in IRD Gazette Notification No. 2456/02 dated September 29, 2025.

Eligible persons are entitled to receive refunds within 45 days from the due date for filing the VAT return.

Read an October 2025 report prepared by the KPMG member firm in Sri Lanka

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