For information call now:
Internal Revenue Service
Austin Service Center
P.O. Box 149342
Austin, TX 78714-9342
Sri Lanka- Personal Services Income
Income that residents of Sri Lanka receive for performing personal services as
independent contractors or self-employed individuals (independent personal
services) in the United States during the tax year is exempt from U.S. income
tax if the residents:
- Are in the United States for no more than 183 days in any 12-month period, or
- Do not have a fixed base regularly available to them in the United States for
the purpose of performing the services.
If they have a fixed base available in the United States, they are taxed on the
income attributable to the fixed base.
Income that residents of Sri Lanka receive for services performed in the United
States as employees (dependent personal services) is exempt from U.S. income tax
if the residents meet the following requirements.
- They are in the United States for no more than 183 days in any 12-month
- Their income is paid by, or on behalf of, an employer who is not a U.S.
- Their income is not borne by a permanent establishment or a fixed base that
the employer has in the United States.
Income received from employment as a member of the regular complement of a ship
or an aircraft operated in international traffic by a Sri Lanka enterprise is
exempt from U.S. tax. If the ship or aircraft is operated by a U.S. enterprise,
the income is subject to U.S. tax.
These exemptions do not apply to public entertainers (such as theater, motion
picture, radio, or television entertainers, musicians, and athletes) from Sri
Lanka who earn more than $6,000 in gross receipts, including reimbursed
expenses, from their entertainment activities in the United States during the
tax year. Regardless of these limits, income of Sri Lanka entertainers is exempt
from U.S. income tax if their visit to the United States is directly or
indirectly supported wholly or substantially by public funds of Sri Lanka or the
United States, their political subdivisions, or local authorities.
These exemptions do not apply to directors� fees and other compensation received
by a resident of Sri Lanka for services performed in the United States as a
member of the board of directors of a company resident in the United States.