1. What is the Salary Calculation Formula?

The salary calculation for Sri Lankan government employees follows the formula: Net Salary = Basic Pay + Allowances - (EPF + ETF + Tax). This calculator helps estimate take-home pay after statutory deductions.

2. How Does the Calculator Work?

The calculator uses the following formula:

Where:

• Basic Pay — The fundamental salary component (LKR)
• Allowances — Additional payments like transport, housing (LKR)
• EPF — Employee Provident Fund contribution (8% of basic pay)
• ETF — Employee Trust Fund contribution (3% of basic pay)
• Tax — Income tax based on taxable income

3. Understanding Salary Components

Basic Pay: The fixed component of salary that determines other benefits.
Allowances: Variable components that may include transport, cost of living, etc.
EPF: Mandatory 8% contribution from employee's basic salary for retirement.
ETF: Mandatory 3% contribution from employer on basic salary.
Tax: Progressive tax rates apply based on income brackets.

4. Using the Calculator

Instructions: Enter basic pay and allowances in LKR. The calculator automatically uses standard EPF (8%) and ETF (3%) rates, but these can be adjusted. Enter applicable tax rate percentage.

5. Frequently Asked Questions (FAQ)

Q1: Are EPF and ETF rates fixed?
A: Standard rates are 8% for EPF and 3% for ETF, but these may change based on government policy.

Q2: How is tax calculated?
A: Tax is calculated on taxable income (Basic Pay + Allowances) based on progressive tax rates.

Q3: What allowances are included?
A: Common allowances include transport, cost of living, and housing, but these vary by position.

Q4: Is this calculator accurate for all government employees?
A: It provides an estimate. Actual salary may vary based on specific allowances and deductions.

Q5: How often should I recalculate my salary?
A: Recalculate whenever there are changes to basic pay, allowances, or tax policies.