Due to recently receiving a high number of emails regarding the subject of buying land and land for sale in Arugam Bay we decided to produce this basic guide. The subject of owning land in Sri Lanka is a complex one and the system has changed several times in recent years. Here is the latest updated information.
Board of Investment (BOI) Projects
In order to buy land as a foreigner through a BOI approved project you need to be investing at least $250,000. This route can provide tax exemptions and the potential to secure a resident visa. For more information see their official website.
Buy Land as a Person
Since 2013 foreigners have not been able to buy land in Sri Lanka. However, you can lease land for up to 99 years. The previous tax of 15% on leasing land as a foreigner no longer applies after being removed in the 2017 budget. The main limitation is that this land must not be used to conduct business.
Buy Land as a Company
There are two options here:
Sri Lankan Company – Find a local partner and buy land as a company. The foreign share in the company is limited to 49% before buying the land. After the purchase of the land the shares can be transferred to full foreign ownership but only after a time of 20 years according to the Land Act 2014.
Foreign Owned Company – Any company operating for less than 10 years and with 50% or more foreign ownership can either lease land for a maximum of 99 years or attempt to buy land as a BOI project.
Other “Options” to Own Land
There are of course other ways to own land or get a resident visa as a foreigner. Arugam Bay and Sri Lanka has a long history of inventing schemes to make it easier and cheaper for foreigners to transfer money into local hands. Be aware that any option not listed above is illegal and is not recommended unless you are willing to risk losing the money in the future.
If anyone has anything to add then feel free to leave a comment below.