Pkrevenue.com

Day: November 29, 2020

  • ITO-2001 defines resident, non-resident persons

    ITO-2001 defines resident, non-resident persons

    ISLAMABAD: Income Tax Ordinance, 2001 has defined resident and non-resident Pakistan for the purpose of apply rate of income tax on domestic source of income.

    The Federal Board of Revenue (FBR) issued ITO 2001 (updated June 30, 2020) and differentiated residents and non-resident Pakistanis.

    Various sections of Income Tax Ordinance, 2001 explains the definition:

    Section 81. Resident and non-resident persons

    Sub-section (1): A person shall be a resident person for a tax year if the person is —

    (a) a resident individual, resident company or resident association of persons for the year; or

    (b) the Federal Government.

    Sub-section (2): A person shall be a non-resident person for a tax year if the person is not a resident person for that year.

    Section 82 – Resident individual: — An individual shall be a resident individual for a tax year if the individual —

    (a) is present in Pakistan for a period of, or periods amounting in aggregate to, one hundred and eighty-three days or more in the tax year;

    (ab) is present in Pakistan for a period of, or periods amounting in aggregate to, one hundred and twenty days or more in the tax year and, in the four years preceding the tax year, has been in Pakistan for a period of, or periods amounting in aggregate to, three hundred and sixty-five days or more; or

    (c) is an employee or official of the Federal Government or a Provincial Government posted abroad in the tax year.

    Section 83 – Resident company: A company shall be a resident company for a tax year if —

    (a) it is incorporated or formed by or under any law in force in Pakistan;

    (b) the control and management of the affairs of the company is situated wholly in Pakistan at any time in the year; or

    (c) it is a Provincial Government or Local Government in Pakistan.

    Section 84 – Resident association of persons: — An association of persons shall be a resident association of persons for a tax year if the control and management of the affairs of the association is situated wholly or partly in Pakistan at any time in the year.

  • PTBA urges form issuance for updating taxpayers’ profile

    PTBA urges form issuance for updating taxpayers’ profile

    ISLAMABAD: Pakistan Tax Bar Association (PTBA) has urged the Federal Board of Revenue (FBR) to launch form for mandatory profile update by registered taxpayers as compliance date is fast approaching.

    The PTBA on November 13, 2020 sent a letter to Muhammad Javed Ghani, Chairman, FBR, urging him to publicize prescribed form for updating business profile by taxpayers under section 114A of Income Tax Ordinance, 2001.

    “The PTBA had tried to highlight this issue on September 26, 2020 but unfortunately no action whatsoever has been taken by the FBR authorities in this regard,” the PTBA said.

    An important amendment was made through Finance Act, 2020 regarding updation of business profile by the taxpayers under section 114A of the Ordinance, 2001 but not specific prescribed form for the purpose is still introduced by the FBR.

    “It is very unfortunate for the PTBA that why said prescribed form is still not publicized by the concerned FBR authorities because it is also a time consuming work for the taxpayers / tax consultants and last date for updating the same is December 31, 2020 as per provisions of law.”

    The PTBA also highlighted the issue of calculation errors of minimum tax for tax year 2020.

    “The last date for submission of return has been notified as December 08, 2020 and till the settlement of issue regarding determination of minimum tax liability, the taxpayers would not be able to submit returns within due date, so action in this regard be taken at priority basis otherwise PTBA would have no other option but to ask for further extension for which the body of PTBA is not desirous.”

    The PTBA said the scheme of the Income Tax Ordinance, 2001 is based on universal self assessment. “Self assessment does not mean only assessment of income, rather assessment of tax liability is also not only the prerogative and right but also obligation of the taxpayer,” the PTBA said, adding that the relevant columns related to attributable taxable income against minimum tax liability which have been blocked in the portal be opened for the taxpayers to incorporate his/its own attributable income as the said option has been provided in the columns related to tax collections made under section 148 of the Income Tax Ordinance, 2001.

  • SBP directs banks to extend working hours for duty, tax collection

    SBP directs banks to extend working hours for duty, tax collection

    KARACHI: State Bank of Pakistan (SBP) on Sunday directed all banks to observe extended working hours to facilitate collection of duty and taxes on Monday November 30, 2020.

    A notification issued by the central bank, stated that in order to facilitate the collection of government receipts / duties / taxes, it has been decided that the field offices of SBP Banking Services Corporation (SBP-BSC) and authorized branches of National Bank of Pakistan (NBP) will observe extended banking hours till 9:00 PM on November 30, 2020 (Monday) for which purpose a special clearing has been arranged at 6:00 P.M. on the same day by the NIFT.

    All banks are, therefore, advised to keep their concerned branches open on November 30, 2020 (Monday) till such time that is necessary to facilitate the special clearing for Government transactions by the NIFT.