Opa At Your Service

New post of employment to pensioners and payment of CLA

Question: This refers to the question and answer regarding the above matter in the Daily News of September 17, 2009 on your page and my question and problem is also related to this.

I am now 62 years and retired from the Local Government Service and obtaining my pension. Again, I along with a few of my friends of around the same ages have been appointed and are now working as Assistant Engineers in an ADB funded Local Government Infrastructure Improvement Project on contract basis with Cabinet approval from February 2009.

According to our appointment letter on the salary it is mentioned that the salary scale attached to the post is Rs. xxxxx per month all inclusive.

Also it is mentioned that the remuneration payable has been in terms of para 4.2.1 and 4.2.2 of the Management Services Circular No. 33 of 5.4.1007 and you are required to contribute to the EPF fund accordingly 8 percent of your monthly salary and the Government will make 12 percent of the monthly salary.

Further the Government will make a contribution equivalent to 3 percent of your salary to the ETF.

Accordingly, from February 2009 we were paid the salary + Rs. 2,500 + Rs. 2,000 (CLA) with above mentioned deduction of EPF 8 percent. It was found on my June month salary that the sum of Rs. 2,000 was not paid and the sum of Rs. 10,000 paid from February to June also have been deducted.

Please clarify whether we are eligible or not eligible for full CLA on our present new post and salary as we have been appointed with Cabinet Approval and it is an ADB funded project with conditions as mentioned above on salary in the appointment letter.

Kum Shan, Trincomalee.

Answer: There has been a lot of confusion regarding this subject of payment of the Cost of Living (CLA) to Government pensioners who are re-employed by Government or semi Government Department, Projects etc.

We understand that as per Public Administration Department Circular No. 9/2007, a Government servant receiving a pension if re-employed by Government is not entitled to or exceed Rs. 4,500 pm as CLA.

Also the Pensions Department by their circular No. 4/2008 and 7/2009 have stipulated further on the duplication of payment of CLA.

Your new employer has by mistake included in the letter of appointment and has also paid you the CLA of Rs. 4,500, where as Rs. 2,000 is in fact included in your pension as CLA.

Thus it is in order for your employer not to pay you the Rs. 2,000 and rectify the error by recovering the CLA paid from February to June. In fact according to one of the officers we contacted, you are lucky to get the Rs. 2,500 as CLA.

Withholding Tax on consultancy service

Question: I shall be thankful, if you would kindly answer my following question by your esteemed service supplied through the Daily News Question and Answer column.

I am a retired government servant drawing a monthly pension and now employed as a consultant to a private organisation for a one year assignment.

The company sends Rs. 5,100 (5 percent of my consultancy fees) monthly to the Income Tax Department. Please let me know whether I have to pay any income tax to the Inland Revenue Department?

Private Consultant, Colombo 3.

Answer: First of all you are not a taxpayer as a Government Pensioner. However there is a Withholding Tax (WHT) on fees received for services rendered. This is applicable only you are receiving Rs. 50,000 or over per month as consultation fee. Since you are receiving only Rs. 5,100 per month you are not liable to pay WHT.

You should apply to the Inland Revenue Department for a direction and on the submission of this direction, the company concerned will stop deducting the 5 percent WHT, sometimes the company concerned may accept of letter given by you stating that you are not liable for payment of WHT. We presume that you are not providing a consultancy service elsewhere and even if you are doing so your total income per month from consultancy service is less than Rs. 50,000 per month.

Leave for estate superintendent

Question: I write with reference to the Question/Answer appearing in the Daily News on August 20, 2009 under the caption ‘Calculating leave according to Shop and Office Act’.

I am working as a Superintendent of an estate and my letter of appointment says that Sunday is an off day for me.

I shall be thankful if you would please clarify the following:

1. When applied for annual leave from Saturday evening till Friday evening, how many days leave is counted? Whether Sunday too is treated as a leave day 7.

2. When leave taken from the evening of the previous day till the following day evening, how many days leave is counted?

Whether previous day night out is considered as one day’s leave?

It would be appreciated if you could reply this early in the Daily News paper.

Rasanjaya de Silva, Horana

Answer: we are not clear about the terms and conditions of your employment, especially with regard to our leave availability. If you are covered by the Shop and Office Act you will be entitled to one and a half days leave for the week.

It appears as if you are only entitled to a day off on Sundays as per information given by you. It’s also not clear whether you are on call duty in the nights too. From the information available 5 days leave has to be counted if you apply for annual leave from Saturday evening till following Friday evening.

When leave is taken from previous day evening till following day evening, it should be counted as one day leave.

Why an Entrance Card to only Public Library, Colombo 7

Question: First of all I wish to thank all concerned for the invaluable services you all are providing to the public in solving their queries and problems. I am also thankful to the Daily News for the pains it takes in publishing the relevant matters.

My question is does the word ‘Public’ vary according to a situation or of an institution? This I ask as the Public Library, Colombo 7 of the Colombo Municipal Council allows one to enter its premises only if one has an ‘entrance card’ which is Rs. 50 (I am not bothered about the amount but of the meaning of ‘public’).

Charging a fee for lending of books is reasonable but for reading newspapers making the entrance card compulsory is unfair, especially because the library has a prefix called ‘public’.

The Public Library at Kotahena is free to visit and what is the difference of ‘Public’ between Colombo 7 and Colombo 13? I shall be thankful if your Centre could made a comment on it.

Nazly Cassim, Colombo 13

Answer: It does not always mean that ‘Public’ means free. The word ‘Public’ refers to the fact that it is not exclusive for a particular group but open to all but not necessarily free of charge. For example public car parks are often on payment basis.

Similarly a fee is charged even at some public toilets. This fee is charged for certain maintenance cost. The Chief Librarian of the Colombo Public Library says that entrance to the Colombo 7, Public Library is only by membership for which an entrance card is issued at a cost of Rs. 50.

The Colombo Library unlike the Kotahena Library provides more facilities such as a reference section, study section, magazine section and a section with a large collection of Sri Lankan books. Thus the requirement for an entrance card, which will enable entry to only those members of the public whose identity or record is available. This entrance card has to be removed annually.

Last will and transfer of wealth

Question: I read in one of the answers that it is not necessary to go to a lawyer to sign a last will but to sign it in front of five witnesses.

(1) Is there a standard legally accepted format for such a will? If so where could I obtain it?

(2) Out of my three children, one has settled down in a foreign country and obtained citizenship there. He is not interested getting dual citizenship. The only immovable prospect I have is the house which is registered as a condominium property of two units. If I die intestate will there be a problem about succession as I read somewhere that one who is not a citizen is liable to a 1000 percent stamp duty. This could affect the two who are in Sri Lanka. Is it advisable to write a last will so that those two will inherit the 2 housing units?

(3) I also own some shares in listed companies and also a growing timber plot where the trees are presold to the company which will pay the price at the time of harvesting. If these are given to the one who is abroad, in a last will, will he be liable for such a 100 percent stamp duty?

A reply would help me and others in a similar plight.

C. de Silva, Nugegoda

Answer: Yes it is not necessary that a last will has to be signed in the presence of a lawyer (Notary Public) and two witnesses, it can also be signed in the presence of 5 witnesses.

1. There is no standard or legal requirement for the format of the Last Will. It can be handwritten by the person making the last will. This document or last will should however have a date, the full name of the person leaving the will, the name or names of the persons who are beneficiaries of the will and clear description of assets, property funds etc. to be distributed as per the will. The names and NIC number and preferably the address of the 5 witnesses as they may be required to give evidence in a testamentary case if necessary.

2. Yes it is better if you write the 2 condominium units to your 2 children in your last will or even preferably gift it to them with your life interest if required. The gift deed will require stamp fee but less cumbersome for your children from going through a testamentary case. Also please be informed that your son need not pay tax of 100 percent on value of property if transferred by gift or testamentary disposition. This 100 percent tax on value exempts spouse, children, parents, brother or sister.

3. As regards the shares in listed companies and timber plots you can nominate your son as the beneficiary to each one of those organisations (listed companies) or include in your last will. Perhaps you can do both to be on the safe side. Here too we do not believe that your son has to pay the 100 percent value tax.

Avoidance of surname on Identity Card

Question: My full name is Katukurunda Kaluarachchige Lankaprema Karunanayake. I use Karunanayake as my family/surname, Lankaprema as my first name/Christian name and Katukurunda Kaluarachchige as my middle/other names. Using initial I declare my name as K.K.L.Karunanayake. My father too had Katukurunda Kaluarachchige Karunanayake as part of his name.

I had to face a lot of difficulties with the length of my name, more than ever when I was abroad. Therefore, I didn’t want my children to undergo the same difficulties and when my only child was born I registered him only as Sachin Harindra Karunanayake. That is what is written on his birth certificate in the box meant for name. He is enrolled in the school only with that name. His minor’s bank account is opened with the same name and in my insurance policies as benefactor only that name is declared.

Recently when my wife went to apply a postal ID card for him under the name Sachin Harindra Karunanayke, the officers at the post office has rejected the application on basis that his full name is not given. They were willing to issue the ID card with the additional name Katukurunda Kaluarachchige. As my son had to take part in a public school sports event on the very next day my wife agreed and got his ID card under Katukurunda Kaluarachchige Sachin Harindra Karunanayake which is much longer name than mine.

My questions are:

1. Should a child have all the names of his father under the Sri Lankan laws?

2. Is there any way for my child to drop me middle name K.K. and exist as Sachin Harindra Karunanayake?

I would be thankful to you if you can help my by providing answers to those questions.

K.K.L. Karunanayake - email

Answer: There is a common system of identifying the surname of a person despite what you may claim as surname. In your case the surname is Katukurunda Kaluarachchige even though you may be using your names as K.K.L. Karunanayake.

In your son’s birth certificate the father’s name appears in full. Therefore, the Authority issuing the identity card for your son will automatically take your family name as his surname. One way of avoiding this is to have on your son’s birth certificate in column 13 the surname as you would like it.

If this was not done at the time of registration of the birth of your son or at the time of application for the birth certificate for your son, it cannot be done now. Karunanayake is your first name and the surname or family name is Katukuranda Kaluarachchige.