- The statutory maximum for issuing refunds is 45 days, but the department’s internal target is faster for compliant taxpayers.
- A new risk-based refund system will replace the current SVAT system from 1 October 2025.
- Eligible exporters with low and medium-risk profiles can receive VAT refunds within 15 days.
- The new system aims to reduce waiting periods for highly compliant businesses.
- The SVAT system, introduced in 2011, led to administrative complexities and cash refund backlogs.
- The new framework will return to a single, unified VAT system.
- High-risk taxpayers can improve their rating by demonstrating compliance with tax laws.
- Businesses should submit tax returns on time and settle outstanding payments to improve their risk profile.
- The new system uses a sophisticated risk calculation based on compliance behavior.
- “Eligible Exporter” status is granted to direct exporters with over 50 percent exports of total supplies.
- The IRD assesses risk based on filing history, revenue, payment history, and third-party data.
- Low and medium-risk taxpayers receive refunds without pre-audit, followed by post-verification.
- High-risk taxpayers undergo pre-verification before refunds, aiming to complete within 45 days.
Source: dailymirror.lk
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
