ISLAMABAD: The Finance Bill, 2021 has proposed to extend key dates for an amnesty to builders and developers who opt to pay tax computed under special provisions.
KPMG Taseer Hadi & Co. Chartered Accountants said that the Finance Bill 2021 proposed to extend key dates for builders and developer who opt to pay tax computed under special provision in accordance with the rules in the Eleventh Schedule of Income Tax Ordinance 2001 on a project by project basis.
Key proposed amendments are as under:
—A new project or an incomplete existing project that is completed by 30 September 2023.
—Any income, profits and gains of a builder or developer of an incomplete existing project earned up to tax year 2019 or tax year 2020 as the case may be.
—Provisions of section 111 of Income Tax Ordinance, 2001 shall not apply to capital investment made in a new project in form of money or land subject to following conditions:
-If the investment is made by a builder and developer being an individual, such person shall open a new bank account and deposit such amount on or before 30 June 2021.
-If the investment is made by a builder and developer through a company or association of person being a single object company or association of person on or before 30 June 2021.
-A person making investment as mentioned above shall submit a prescribed form on Iris web portal by 30 June 2021.
-The project grey structure shall be certified in case of builder by approving authority or NESPAK on or before 30 September 2023.
-In case of developer the approving authority or NESPAK shall certify landscaping on or before 30 September 2023 and a firm of chartered accountants shall certify that at least 50 per cent of plots have been booked for sale and at least 40 per cent of sale proceeds have been received by 30 September 2023 and 50 per cent of the roads have been laid up as certified by the approving authority or NESPAK.
—Provisions of section 111 of Income Tax Ordinance, 2001 shall not apply to first purchaser of building or a unit of the building purchased from the builder from a new project or from incomplete existing project and payment is made through cross banking channel between date of registration of the project and ending on 31 March 2023.
—Provisions of section 111 of Income Tax Ordinance, 2001 shall not apply to the purchaser of plots who intends to construct building if purchase and payment is made through cross banking channel on or before 30 June 2021 and construction is started on or before 31 December 2021 and such construction is completed on or before 30 September 2022.