If you look at a Sri Lankan payslip, one deduction confuses more people than any other. It might be labelled APIT, or PAYE, or just “tax” — and unlike your EPF, it doesn’t go into a fund with your name on it. This guide explains what that deduction is, exactly how it’s calculated in 2026, and the question almost nobody answers straight: whether you can get some of it back.
What is APIT — and is it the same as PAYE?
Yes, for everyday purposes they’re the same thing. PAYE (Pay As You Earn) was the name of Sri Lanka’s salary-withholding tax for decades. In 2020 it was rebranded APIT — Advance Personal Income Tax — and briefly made optional, requiring your consent before your employer could deduct it. That consent era ended on 1 April 2023: APIT is now a mandatory deduction. Your employer must calculate it on your monthly pay, withhold it, and remit it to the Inland Revenue Department (IRD) in your name by the 15th of the following month.
The word “advance” is the part worth remembering. APIT is not a final tax — it’s a monthly prepayment of your annual income tax bill, made for you before your salary reaches your account.
How the monthly deduction works
Each month, your employer takes your total “regular profits from employment” — salary, fixed allowances, overtime and taxable benefits — and looks it up in the IRD’s APIT Table 1. The table has the tax-free allowance built in: the first Rs. 150,000 per month (Rs. 1.8 million a year of personal relief) attracts no tax at all. Above that, rates step up in bands:
| Monthly pay (LKR) | Rate | Monthly APIT formula |
|---|---|---|
| Up to 150,000 | 0% | No deduction |
| 150,001 – 233,333 | 6% | (Pay × 6%) − 9,000 |
| 233,334 – 275,000 | 18% | (Pay × 18%) − 37,000 |
| 275,001 – 316,667 | 24% | (Pay × 24%) − 53,500 |
| 316,668 – 358,333 | 30% | (Pay × 30%) − 72,500 |
| Above 358,333 | 36% | (Pay × 36%) − 94,000 |
IRD APIT Table 1, Y/A 2025/26 (Inland Revenue (Amendment) Act No. 2 of 2025, effective 1 April 2025) — still the current table in 2026.
Two examples: on Rs. 200,000 a month the deduction is 200,000 × 6% − 9,000 = Rs. 3,000. On Rs. 300,000 it’s 300,000 × 24% − 53,500 = Rs. 18,500. Don’t want to do the arithmetic? Our free salary & APIT calculator applies the current table and shows your take-home pay instantly.
A second job or director’s fees are taxed under a different table (Table 7) at flat rates, and one-off payments like bonuses use their own table. That’s one of the common reasons the tax withheld across a year doesn’t match what you actually owe.
Where your APIT goes: the T-10 certificate
Every rupee of APIT withheld is credited to you personally at the IRD. After the tax year ends (31 March), your employer must give you a T-10 certificate summarising your pay and the tax deducted. Keep it — it’s your proof of prepayment, and it’s the number that decides whether you’ve overpaid or underpaid for the year.
APIT vs your annual return: when you’re owed a refund
Because APIT is charged month by month, it silently assumes your situation was identical all twelve months. Real life is messier, and the mismatches usually fall in your favour. You may have overpaid if you:
- worked only part of the year — started your first job, resigned, or had unpaid months, so your annual income never reached what the monthly table assumed;
- changed jobs and both employers applied the tax-free threshold inconsistently, or a new employer taxed you at a “catch-up” rate;
- had qualifying reliefs the monthly table ignores — like the rent relief for income from letting property, or solar-panel relief;
- received a one-off payment taxed at a higher flat rate than your final annual position justified.
The only way to settle the difference — in either direction — is your annual income tax return. Your return totals your actual income, applies your actual reliefs, and offsets the APIT already paid per your T-10. If more was withheld than you owe, the balance is a refund you can claim; if you had other income (bank interest, rent, freelance work), the return is where you declare it and pay the difference.
This is exactly what LankanTax is built for: you answer plain-language questions, it organises your return for free, and a Chartered Accountant reviews and lodges it with the IRD. If a refund is due, the return is how you ask for it.
Check your own payslip this month
Take your gross monthly pay, run it through the APIT calculator, and compare the result with the tax line on your payslip. If they differ by more than a few rupees, ask payroll which table and pay items they used — genuine differences are usually benefits-in-kind you didn’t count, or a second-employment table being applied. And since you’re looking at the deductions anyway, make sure your EPF 8% is calculated on the right base too.
Think you’ve overpaid APIT?
LankanTax turns your T-10, payslips and bank interest certificates into a ready-to-lodge return — free for individuals, reviewed and lodged by a Chartered Accountant. Filing is the only way to claim what you’re owed.
See how it works →Quick answers about salary tax.
Functionally, yes. PAYE (Pay As You Earn) was renamed APIT (Advance Personal Income Tax) in 2020. Both describe income tax withheld from your salary by your employer and remitted to the IRD on your behalf. The mechanics changed slightly — APIT was consent-based between 2020 and March 2023, and has been a mandatory deduction since 1 April 2023 — but on a payslip the two labels refer to the same deduction.
Rs. 3,000 per month, if the whole Rs. 200,000 is regular pay from your main job. The IRD formula for that band is (200,000 × 6%) − 9,000. Your EPF 8% (Rs. 16,000 if fully EPF-liable) comes out separately, leaving a take-home of about Rs. 181,000.
Yes — if more APIT was withheld during the year than your final annual tax works out to, the excess is refundable, but only if you file an annual income tax return claiming it. Common causes are working part of the year, changing jobs, or reliefs your employer’s monthly table couldn’t account for. Your T-10 certificate shows what was withheld; the return does the reconciliation.