A valid Taxpayer Identification Number (TIN) became mandatory for several specified transactions, including opening a bank account, registering a motor vehicle and obtaining a credit card, from 1 November, the Inland Revenue Department (IRD) said.
The department said individuals must submit a valid TIN when opening an account at a bank or financial institution, obtaining approval for a building plan, registering a motor vehicle or renewing a vehicle licence.
The requirement also covers the registration of land or land titles, business registration, the transfer of shares in companies incorporated in Sri Lanka and obtaining credit cards. That makes eight transactions in all.
Officials who handle these transactions must verify that the TIN is valid before they provide the service, the IRD said.
People who do not yet have a TIN can register through the IRD’s e-Services portal, which also lets individuals check their existing TIN online.
Once the TIN has been verified, a printout showing both the person’s National Identity Card (NIC) number and TIN can be submitted instead of the official TIN certificate, the department said.
The IRD also said that a TIN is compulsory for all individuals aged 18 and above. It rejected claims that everyone who holds a TIN has to pay income tax. According to the department, income tax is payable only by individuals whose annual income exceeds Rs. 1.8 million.
Background
The IRD is the government department responsible for administering income tax and several other taxes in Sri Lanka. A TIN is the number it assigns to identify a person or business in its records.
Holding a TIN and paying income tax are separate matters. A TIN identifies a person in the tax system. Whether tax is payable depends on income, and the IRD has said that the Rs. 1.8 million annual income level applies to individuals.
The requirement now applies to eight kinds of transaction in everyday financial and administrative life, from banking to land and business registration. The rule takes effect at the point of service, since the officials handling each transaction are required to check the number.
What it means
Anyone aged 18 or over who plans to open a bank account, register or relicense a vehicle, apply for a credit card, register land or a business, transfer shares or seek building plan approval will need a valid TIN at hand. Applications made without one may be held up while the number is obtained.
The IRD’s guidance is that people without a TIN should register through its e-Services portal and verify the number online. A printout showing the NIC number and the TIN is then enough, so no separate certificate is needed once the number has been verified.
The department’s statement also addresses a common concern. Obtaining a TIN does not on its own create an income tax liability, and the IRD has said tax applies only to individuals earning more than Rs. 1.8 million a year.
