What is APIT?
APIT stands for Advance Personal Income Tax. It is the tax your employer withholds from your salary every month and pays to the Inland Revenue Department of Sri Lanka (IRD) on your behalf. APIT replaced the older PAYE system in 2020. The idea is simple: instead of paying one large tax bill after the year ends, you pay your income tax a little at a time through payroll.
The legal basis is the Inland Revenue Act No. 24 of 2017, which sets out how employment income is taxed and requires employers to withhold tax on it. The current rates and the higher tax-free relief come from the Inland Revenue (Amendment) Act No. 02 of 2025, certified on 20 March 2025 and effective from 1 April 2025. The IRD then published a fresh set of APIT tax tables (Tables 01 to 08) for employers to use from that date.
An APIT calculator like the one above follows the same logic as the IRD tables. You enter your monthly or annual pay, and it shows how much tax should come off each payslip, what a bonus will cost you in tax, and what lands in your bank account after EPF.
APIT tax rates and slabs for 2026
The tax year in Sri Lanka, called the year of assessment, runs from 1 April to 31 March. The rates below have applied since the 2025/26 year of assessment and still apply in 2026/27. The 2026 Budget, presented in November 2025, did not change personal income tax rates, and the Inland Revenue amending Act passed in mid-2026 also left the slabs and relief unchanged (it dealt with items such as life insurance proceeds and a credit for salary arrears).
| Annual employment income | Monthly equivalent | Rate |
|---|---|---|
| First Rs 1,800,000 (personal relief) | First Rs 150,000 | 0% |
| Next Rs 1,000,000 (to Rs 2.8m) | Next Rs 83,333 (to Rs 233,333) | 6% |
| Next Rs 500,000 (to Rs 3.3m) | Next Rs 41,667 (to Rs 275,000) | 18% |
| Next Rs 500,000 (to Rs 3.8m) | Next Rs 41,667 (to Rs 316,667) | 24% |
| Next Rs 500,000 (to Rs 4.3m) | Next Rs 41,667 (to Rs 358,333) | 30% |
| Above Rs 4,300,000 | Above Rs 358,333 | 36% |
Compared with the 2023/24 and 2024/25 years, two things changed in April 2025. The personal relief went up from Rs 1.2 million to Rs 1.8 million a year (Rs 100,000 to Rs 150,000 a month), and the first taxable band was widened to Rs 1 million at 6%, which removed the old 12% band. Most salaried workers therefore pay less APIT than before for the same gross salary.
IRD Tax Table 01 shortcut formulas
IRD Tax Table 01 covers regular monthly pay. Payroll teams often use its shortcut formulas, where M is your monthly regular profit from employment (gross salary plus taxable benefits). They give exactly the same answer as working through the slabs one by one.
| Monthly regular profit (M) | APIT per month |
|---|---|
| Up to Rs 150,000 | Nil |
| Rs 150,001 – 233,333 | M × 6% − 9,000 |
| Rs 233,334 – 275,000 | M × 18% − 37,000 |
| Rs 275,001 – 316,667 | M × 24% − 53,500 |
| Rs 316,668 – 358,333 | M × 30% − 72,500 |
| Above Rs 358,333 | M × 36% − 94,000 |
How the APIT calculator works
- Find your monthly regular profit. Add basic salary, fixed allowances and the taxable value of benefits such as a company vehicle or housing. Regular overtime and commissions that are paid every month also count.
- Turn it into an annual figure. Multiply by 12. If you choose "Annual salary" in the tool, this step is skipped.
- Deduct the Rs 1,800,000 personal relief. What remains is taxable.
- Apply the slabs from 6% up to 36% and add them together for the annual APIT.
- Divide by 12 for the monthly deduction on your payslip.
- For a bonus, work out the tax on your full-year pay with the bonus included, then subtract the tax on your pay without it. The difference is the APIT on the bonus.
Monthly APIT = Tax(annual regular pay) ÷ 12
APIT on a lump sum = Tax(regular pay + all lump sums this year) − Tax(regular pay + earlier lump sums)
Your employee EPF contribution is not deducted before APIT is worked out. APIT is calculated on gross employment income, and EPF is taken from your pay separately. This is one of the most common reasons people think their APIT is "wrong" when it is not.
Worked example: Rs 300,000 a month
Nadeesha earns a basic salary of Rs 250,000 and a fixed allowance of Rs 50,000, so her monthly regular profit is Rs 300,000, or Rs 3,600,000 a year.
| Annual pay | Rs 3,600,000 |
| Less personal relief | − Rs 1,800,000 |
| Taxable income | Rs 1,800,000 |
| First Rs 1,000,000 at 6% | Rs 60,000 |
| Next Rs 500,000 at 18% | Rs 90,000 |
| Remaining Rs 300,000 at 24% | Rs 72,000 |
| Annual APIT | Rs 222,000 |
| Monthly APIT | Rs 18,500 |
Check with the Table 01 shortcut: 300,000 × 24% − 53,500 = Rs 18,500. The two methods agree.
Her payslip then looks like this: gross Rs 300,000, less employee EPF at 8% (Rs 24,000), less APIT (Rs 18,500), giving a take-home pay of Rs 257,500. Her employer separately pays EPF at 12% (Rs 36,000) and ETF at 3% (Rs 9,000), so her total cost to the employer is Rs 345,000 a month.
APIT on a bonus or lump-sum payment
Bonuses, incentives, arrears and other one-off payments go through IRD Tax Table 02 rather than the monthly table. The method spreads your whole year's income across the slabs, so a bonus is taxed at the rate you would actually reach once it is added to your salary for the year.
This example follows one published by TaxAdvisor.lk for the 2025/26 year. Mr Ranaweera earns Rs 170,000 a month and receives a Rs 600,000 incentive in April 2025.
| Regular pay for the year (170,000 × 12) | Rs 2,040,000 |
| Plus incentive | Rs 600,000 |
| Estimated aggregate pay | Rs 2,640,000 |
| Tax on Rs 2,640,000: (2,640,000 − 1,800,000) × 6% | Rs 50,400 |
| Tax on Rs 2,040,000: (2,040,000 − 1,800,000) × 6% | Rs 14,400 |
| APIT on the incentive | Rs 36,000 |
His normal monthly APIT stays at 170,000 × 6% − 9,000 = Rs 1,200. If he receives another bonus later in the same year, enter the Rs 600,000 under "Earlier lump sums this year" and the calculator will tax the new bonus at the next slabs up, the same way Table 02 does.
EPF and ETF on your payslip
APIT is not the only deduction on a Sri Lankan payslip. Two retirement and welfare funds also apply to most private-sector and many state-sector employees.
| Contribution | Rate | Who pays | Law |
|---|---|---|---|
| EPF (employee) | 8% minimum | Deducted from your pay | Employees' Provident Fund Act No. 15 of 1958 |
| EPF (employer) | 12% minimum | Employer, on top of pay | Employees' Provident Fund Act No. 15 of 1958 |
| ETF | 3% | Employer only | Employees' Trust Fund Act No. 46 of 1980 |
The EPF, managed by the Central Bank of Sri Lanka, states minimum contributions of 8% from the employee and 12% from the employer, based on "total earnings". Total earnings usually includes basic pay and most fixed allowances, but not overtime or bonuses, so the calculator lets you choose whether EPF is based on basic plus allowances or on basic salary only. Check your payslip to see which your employer uses. Some employers contribute more than the minimum; you can change the employee rate in the tool.
Who APIT applies to, and who it does not
- Applies to: resident employees, and non-resident employees who are Sri Lankan citizens, on salary, wages, allowances, bonuses, commissions and the taxable value of benefits. The calculator uses the tables for these employees.
- Different tables: the IRD publishes separate APIT tables for non-resident foreign employees, for cases where the employer bears the employee's tax, for a second employer, and for terminal benefits. This calculator does not cover those cases.
- Terminal benefits: gratuity, compensation for loss of office and withdrawals from EPF or ETF on retirement are taxed under separate rules, not the monthly slabs.
- Exempt income: some payments are excluded from employment income, for example certain reimbursements of costs genuinely incurred for the employer. Ask your payroll team if you are unsure whether a payment counts.
Common APIT mistakes to avoid
- Using the old relief. The relief has been Rs 150,000 a month since April 2025. A payslip that still taxes income above Rs 100,000 a month is using out-of-date tables.
- Deducting EPF before tax. Employee EPF does not reduce your APIT. Tax is on gross employment income.
- Taxing a bonus as if it were monthly salary. Running a bonus through Table 01 for one month overstates the tax for most people. Lump sums belong in Table 02.
- Forgetting earlier bonuses. Each new lump sum in the same year is taxed on top of the earlier ones, so a second bonus can fall into a higher slab than the first.
- Leaving out benefits. A company vehicle, housing or other benefit has a taxable value that is added to M. Leaving it out understates the APIT.
- Mixing up tax years. The slabs run from April to March. A bonus paid in March and one paid in April belong to different years of assessment.
Checking your payslip with this APIT calculator
Enter the same basic salary and allowances that appear on your payslip, choose the EPF base your employer uses, and compare the APIT figure. If they differ, the usual causes are a taxable benefit you did not include, a change in salary part-way through the year, or a bonus being taxed in the same month. When your salary changes during the year, Table 01 simply applies to the new monthly amount from that month onward.
If APIT has been deducted from all your employment income and you have no other income above the small limits set by the IRD, you may not need to file a return. Where too much APIT has been deducted across the year, for example because you changed jobs, you can claim the difference through a return of income with the IRD.
Frequently asked questions
How do I use an APIT calculator for my salary?
Enter your monthly basic salary and taxable allowances. The calculator subtracts the Rs 150,000 monthly relief, applies the 6% to 36% slabs and shows your monthly APIT, EPF and take-home pay. Add any bonus in the lump-sum box to see the tax on it.
What is the APIT tax-free limit in Sri Lanka in 2026?
Rs 1,800,000 a year, which is Rs 150,000 a month. If your monthly regular employment income is Rs 150,000 or less, no APIT is deducted.
How much APIT is deducted on a salary of Rs 200,000?
Using Table 01: 200,000 × 6% − 9,000 = Rs 3,000 a month, or Rs 36,000 a year.
What are the APIT slabs from 1 April 2025?
After the Rs 1.8 million relief: 6% on the next Rs 1 million, 18% on the next Rs 500,000, 24% on the next Rs 500,000, 30% on the next Rs 500,000 and 36% on the balance.
Is EPF deducted before APIT is calculated?
No. APIT is worked out on your gross employment income. The 8% employee EPF contribution is deducted from your pay separately and does not lower your taxable income.
How is APIT calculated on a bonus?
Under IRD Tax Table 02, the tax on your full-year pay including the bonus is compared with the tax on your pay without it. The difference is deducted from the bonus, after allowing for tax already deducted on earlier lump sums.
Did the 2026 Budget change APIT rates?
No. The Budget for 2026 and the 2026 amendments to the Inland Revenue Act did not change the personal relief or the tax slabs, so the rates from 1 April 2025 still apply. We check the rates regularly and show the last check date at the top of this page.
Do foreigners working in Sri Lanka use the same APIT table?
Residents do. Non-resident employees who are not Sri Lankan citizens are covered by a separate IRD table, which this calculator does not apply.
Is APIT the same as PAYE?
APIT replaced PAYE tax from 2020. Both are taxes withheld from salary by the employer, but APIT is the current system under the Inland Revenue Act No. 24 of 2017.