Obligation to file a return

Income Tax Returns for individuals

An individual who is in receipt of emoluments, pension or deriving income from trade, business, profession, agriculture, rents and other sources should fill in a return of income if he:

• is registered at the MRA ,i.e has been allocated a Tax Account Number

• derives a chargeable income whether he is registered or not

• Net Income exceeding the Reliefs, Deductions & Allowances Category A per year

• Every person who, in an income year derives total net income of an amount exceeding 500,000 rupees

• Gross income from business exceeding Rs 2 million per year

• Emoluments from which tax has been withheld

• Income which has been subject to tax deduction at source

Calculation of chargeable income

Chargeable income = Gross Income – allowable deductions – Exemptions and reliefs.

Allowable deductions include expenditure incurred in the production of income ,losses ,bad debts and annual allowance(instead of depreciation)

Tax Rates

Income Tax Act – First Schedule – Part I

An individual is taxed on his annual chargeable income as from 1 July 2025 as follows: