KARACHI: Federal Board of Revenue (FBR) has imposed additional tax liability on Meezan Bank Limited by making changes to deemed assessment order, sources said on Friday.
According to official documents, the FBR has made changes to the deemed assessment orders of Meezan Bank for previous years, including the 2021 tax year. These changes were primarily related to the allocation of expenses for dividends and capital gains, provisions for loans and advances, investments, and other assets.
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In the revised order for the 2015 tax year, additional issues were raised concerning the taxability of the gain on a bargain purchase and the non-adjustment of losses for HSBC Bank Middle East – Pakistan Branches.
Meezan Bank has obtained a stay order from the High Court of Sindh against the demands made through the revised order for the 2015 tax year. Both the bank and the tax department have filed appeals with the appellate authorities regarding these matters.
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The bank’s management, in consultation with tax advisors, is confident that the decision will be in their favor, and thus no provision has been made in the unconsolidated financial statements regarding these matters. However, the additional tax liability related to the gain on a bargain purchase and non-adjustment of losses for HSBC Bank Middle East – Pakistan Branches is Rs. 1,096 million and Rs. 706 million, respectively.
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