FINANCIAL JOURNAL

GOVERNMENT OF PAKISTAN REVENUE DIVISION FEDERAL BOARD OF REVENUE  Islamabad, the 28th September, 2018  NOTIFICATION (Income Tax)  S.R.O. 1165(1)/2018 The following draft of certain further amendments in the income Tax Rules, 2002 which the Federal Board of Revenue proposes to make in exercise of the powers conferred by sub-section (1) of section 237 of the Income Tax Ordinance, 2001 (XLIX of 2001), is hereby published for information of all persons likely to be affected thereby, as required by sub-section (3) of the said section and notice is hereby given that the draft shall be taken into consideration by the Federal Board of Revenue after seven days of its publication in the official Gazette.  Any objection or suggestion which may be received from any person, in respect of the said draft, before expiry of the aforesaid period, shall be taken into consideration by the Board. DRAFT AMENDMENT In the aforesaid Rules, in Chapter – VIIIA, the follo...

T he prime interest and aim of any prudent and rational tax payer would always be to reduce the impact of taxes on his income, turnover and in some cases his expenses for instance tax on electricity bills, tax on vehicle registration e.t.c. as the case maybe. To achieve this objective while remaining within the parameters of law it is important to have an understanding of the following provisions under the Income Tax Ordinance, 2001: 1) Deductible Allowances; 2) Tax Credits;   3) Reduction in Tax Liability; (Will be discussed in part 3 of this series) 4) Exemptions and Concessions   The above concepts are the prime areas which allows taxpayers to take benefit of and reduce their tax liability besides exemptions and concisions and immunities provided elsewhere in the Income tax Ordinance, 2001. This blog is the first part of this series and we are going to review the basic concept of Deductible Allowances under the Income Tax Ordinance, 2001. ...

T his blog is in continuation to our previous blog written in detail on Withholding Taxes .  In this blog we will particularly discuss about the mechanism of the provisions of Advance Tax under the section 147 of the Income Tax Ordinance 2001.  Definition of Advance Tax "Advance tax is not a tax but is nearly a provisional payment of an amount towards due tax....  Therefore, it is a supplementary tax collection system, which is finally adjust it in the tax payable of the taxpayer" (2010 PTD 1295) Scope of Advance Tax under section 147 of the Income Tax Ordinance 2001  Indivduals: Subject to the exceptions as discussed below every individual who has been charged to tax liability for latest tax/assessment year is liable to pay Advance Tax every quarter under the section 147 one of the Income Tax Ordinance 2001.   AOP/Company: Subject to the exceptions discussed below every AOP and Company is liable to pay Advance Tax ev...

The FBR has allowed 'one time option' to the taxpayers in order to get immunity for those selected through automatic tax audit selection procedures laid down under the Section 214(D) of the Income Tax Ordinance 2001. The said option has been given through the mini budget 2018-19 presented by the Finance Minister Mr Asad Umar. The concept of the automatic audit selection recently came into effect through Section 214(D) of the Income Tax Ordinance 2001. However, the said provision was removed/omitted through the finance act 2018 due to the hardship faced by the new taxpayers.  In order to give relief to the taxpayers who have been selected automatically for the audit under section 214(d) the Federal government has granted a 'one time option' only if the taxpayer pay tax at 25% higher rate than that declared as tax liability then that declared in the income tax return. Doing so the audit proceedings initiated under the provisions of 214 D of the In...

The Federal Tax Authority (FTA) of UAE issued its cabinet decision number 41 of 2018 regarding introduction of tax refunds for tourist scheme. This decision is in continuation to the Tourist Refund Scheme (TRS) which was issued earlier on 24th July 2018 providing proper mechanism for the same.  As per the previous announcement of FDA the effective date of TRS is November 2018 and the retailers are supposed to register themselves from 10th September 2018 in order to be included in the said scheme. The key points of the cabinet decision are as under: The Chairman of FTA will announce the official date for implementation of the FTA before 1st January 2019; A person will be eligible to obtain the refund as per TRS if the following conditions are met: i) Conditions laid down in article 68(2) of the the Executive Regulations; ii) The goods must be purchased from a retailer registered with the TRS; iii) The purchase or export of goods must fulfill the...