International service providers of Sri Lanka allowed to open foreign currency accounts

International service providers in Sri Lanka and their employees are given permission to open foreign currency accounts in licensed commercial banks with effect from May 07th, the Central Bank announced today.

Any resident company or partnership registered in Sri Lanka or any individual resident in Sri Lanka, who are providing certain categories of international services, and their employees are eligible to open and maintain these foreign currency accounts.

The accounts can be current, savings or term deposits. Credits to the accounts are confined to proceeds on international services received from abroad through banking channels.

Employers can make the payments in foreign currency in the form of bank transfers to their employees who are directly involved in the projects carried out by the employer by debiting the said account, the Central Bank advised.

Accounting, book keeping or auditing, tax advisory services, services of a draftsman, engineering services, software development, data processing, data base development or system designing, advertising outside Sri Lanka, research work and report writing, photography, publishing outside Sri Lanka, beauty culture, hairdressing or modeling outside Sri Lanka, services of a sports person or an artist, services of a valuer or auctioneer, services of a plumber, mason or carpenter, quantity surveying, health care services are some of the eligible services.

The Central Bank says these new measures will allow international services providers and their employees to avail themselves with income tax exemptions granted by the Inland Revenue (Amendment) Act No. 19 of 2009.