Govt. removes tax imposed on children’s savings accounts

Friday, 11 May 2018 00:00 - - {{hitsCtrl.values.hits}}

By Charumini de Silva

The Government, yesterday, announced that it has decided to remove the withholding tax imposed on children’s bank savings accounts under the age of 18 as an effort to inculcate the habit of saving among youngsters. “We have decided to remove the 2.5% tax imposed on children’s savings accounts with immediate effect,” Finance Minister Mangala Samaraweera said at a media briefing held at the Ministry yesterday.

Under tax reforms effective from April 2018, bank deposits were to be taxed at 5%.

He claimed the former regime taxed children’s accounts for interest above Rs.5,000.

“We have removed all taxes on children’s savings accounts until they are 18 years old,” he added.