Fair Share Contribution

Liability to Fair Share Contribution

Every individual whose Fair Share Contribution Income Threshold exceeds 12 million rupees in an income year shall, in addition to his liability to income tax, pay to the Director-General a Fair Share Contribution. The Fair Share Contribution shall be calculated at the rate of 15% of the leviable Income in excess of Rs 12 million.

The Fair Share Contribution shall be payable with respect to income derived by the individual for the income year commencing on 01 July 2025 and for the subsequent 2 income years i.e. up to 30 June 2028.

Fair Share Contribution Income Threshold is the sum of

• the net income of an individual;

• the dividends paid to that individual by a resident company and a co-operative society registered under the Co-operatives Act; and

• the share of dividends of that individual from a resident société or succession to which he would have been entitled as an associate of a société or heir in a succession, had the dividends been wholly distributed among the associates or heirs.

However, the Fair Share Contribution Income Threshold excludes

• dividends or distributions from a global business entity; and

• any lump sum by way of commutation of pension or death gratuity or as consolidated compensation for death or injury and paid

  1. by virtue of any enactment;

  2. from a superannuation fund; and

  3. under a personal pension scheme approved by the Director-General.

Leviable income is the sum of

• the chargeable income of an individual;

• the dividends paid to that individual by a resident company and a co-operative society registered under the Co-operatives Act; and

• the share of dividends of that individual from a resident société or succession to which he would have been entitled as an associate of a société or heir in a succession, had the dividends been wholly distributed among the associates or heirs.

However, the leviable income excludes

• dividends or distributions from a global business entity; and

• any lump sum by way of commutation of pension or death gratuity or as consolidated compensation for death or injury and paid

  1. by virtue of any enactment;

  2. from a superannuation fund; and

  3. under a personal pension scheme approved by the Director-General.