IRD tax invoice format:
mandatory requirements, 18% VAT bill &
RAMIS guide.
A practical compliance overview for Sri Lankan businesses, contractors, and service providers. Review the mandatory Inland Revenue Department (IRD) tax invoice requirements, understand official VAT bill formats, 18% VAT & 2.5% SSCL calculation rules, and generate RAMIS-ready invoices.
Reviewed 12 October 2026. Sources: IRD prescribed tax-invoice format and IRD implementation notice. This guide is general information, not tax advice.
IRD tax invoice mandatory requirements (Section 20 checklist)
Under Section 20 of Sri Lanka's Value Added Tax Act No. 14, an invoice cannot serve as an official "Tax Invoice" (or VAT bill) unless it explicitly contains the following statutory requirements.
Supplier details & IRD tax registration
Every tax invoice must unequivocally identify the registered business entity issuing the document:
Title, serial sequence & recipient details
For your corporate client to claim input tax credits in their IRD RAMIS filings, these criteria must be fulfilled:
Reviewing VAT and SSCL before calculation
VAT and the Social Security Contribution Levy (SSCL) are separate obligations. Registration, scope, exemptions and the correct calculation should be checked for the business and transaction before either amount is added.
The IRD Compounding Rule
1. Base Chargeable Scope: Total value of goods and professional services supplied.
2. SSCL (2.5%): Calculated directly on the chargeable turnover base.
3. VAT Base: Compounded base equals Chargeable Scope + 2.5% SSCL.
4. VAT (18%): 18% applied on the compounded VAT base.
5. Total Payable: Base + SSCL + VAT.
Standard Commercial Supply
From initial quotation to official tax invoice
The standard commercial sequence for billing corporate and institutional clients in Sri Lanka.
Commercial Quotation
Issue an itemized quotation with estimated costs, unit quantities, and validity dates. At this stage, no tax liability is triggered under Sri Lankan law until the offer is accepted.
Purchase Order & Delivery
The client issues an official Purchase Order (PO). Mobilization commences upon receipt of the advance payment, followed by completion of work or equipment handover at the client site.
Official Tax Invoice
Issue the sequential Tax Invoice using the applicable 9-digit TIN and every field required by the current prescribed format. Eligibility for input tax credit depends on the law and the facts of the supply.
VAT bill format in Sri Lanka (VAT invoice standards)
In Sri Lanka, the terms "VAT Bill", "VAT Invoice", and "Tax Invoice" refer to the official document issued exclusively by registered taxpayers. Here is how a compliant VAT bill format is structured compared to a standard commercial bill.
Official IRD VAT Bill Format
Mandatory For: Companies and sole proprietors registered for VAT with the Inland Revenue Department.
Key Characteristics:
• Prominently titled "TAX INVOICE" or "VAT INVOICE"
• Displays supplier's 9-Digit TIN & VAT Registration Number
• Displays customer's TIN (mandatory for recipient's RAMIS input credit claim)
• Itemizes goods/services, quantities, net value, separate 18% VAT, and gross payable
• Required by corporate clients to claim input tax deduction.
Standard Commercial Bill / Invoice
Applicable For: Small businesses, freelancers, and trades falling below the statutory IRD VAT registration turnover threshold.
Key Characteristics:
• Titled simply "INVOICE" or "COMMERCIAL INVOICE"
• Displays Business Registration Number (BRN) and contact details
• NO VAT is charged; neither 18% VAT nor VAT registration numbers may be shown
• Client pays the exact net total without VAT markup
• Full legal standing for domestic commercial transactions.
Frequently asked questions
What are the mandatory IRD tax invoice requirements in Sri Lanka?
Under Section 20 of the Value Added Tax Act No. 14, an official tax invoice must explicitly include the words TAX INVOICE, supplier legal trade name, address, 9-digit TIN, VAT registration number, unique serial invoice number, date of issue, customer name, address and TIN/VAT number, description and quantities of goods/services, total value excluding VAT, separately stated 18% VAT amount, and the gross invoice total in LKR.
What is the difference between a VAT bill format and a commercial invoice?
A VAT bill (tax invoice) can only be issued by an entity registered for VAT with the Inland Revenue Department (IRD). It itemizes the 18% VAT amount separately with the supplier’s TIN and VAT registration number, allowing registered corporate clients to claim input tax credits in RAMIS. Non-registered businesses issue standard commercial bills without charging or claiming VAT.
How do I calculate 18% VAT and 2.5% SSCL on an invoice in Sri Lanka?
VAT and SSCL are distinct obligations under Sri Lankan tax law. SSCL (2.5%) is calculated on the turnover base, while 18% VAT is applied on the taxable supply base (or compounded base where applicable). Businesses should verify their specific registration status and exemptions with the IRD.
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