Export of services (s.154A)
Tax on export of services, including IT and freelancing, is collected on the foreign proceeds. It is the final tax if the return is filed.
Where it applies
- Exporters of services, freelancers and IT companies receiving foreign proceeds through banks
How it works, step by step
The section of law behind each step is shown beside it.
- 1Proceeds come through a banks.154A(1)
The bank deducts tax when the foreign remittance is converted.
- 2Keep the PRCs.154A
Get a proceeds realisation certificate for each remittance.
- 3File the returns.154A
With the return filed, the deduction is your final tax on this income.
Rates and rules
| Case | Rate / rule | Law |
|---|---|---|
| PSEB-registered IT and IT-enabled services | 0.25% (up to TY2029) | s.154A |
| Other export of services | 1% | s.154A |
| Social media platform revenue (bank deduction) | 5% – minimum tax for residents, final for non-residents without a PE (10% non-filers) | s.154B |
Worked example
A freelancer receiving US$30,000 (about Rs 8.4 million) and registered with PSEB pays about Rs 21,000 at 0.25%.
Points to watch
- Use the Export of services calculator for exact figures.