Income Tax Ordinance 2001: taxation on non-resident ship owner, charterer

Income Tax Ordinance 2001: taxation on non-resident ship owner, charterer

KARACHI: A ship owned or chartered by a non-resident person before leaving any port in Pakistan is required to furnish a return of income.

Income Tax Ordinance, 2001 recently updated by the Federal Board of Revenue (FBR) explained the taxability on the non-resident ship owner or chartered under Section 143.

Section 143: Non-resident ship owner or charterer

Sub-Section (1): Before the departure of a ship owned or chartered by a non-resident person from any port in Pakistan, the master of the ship shall furnish to the Commissioner a return showing the gross amount specified in sub-section (1) of section 7 in respect of the ship.

Sub-Section (2): Where the master of a ship has furnished a return under sub-section (1), the Commissioner shall 1[, after calling for such particulars, accounts or documents as he may require,] determine the amount of tax due under section 7 in respect of the ship and, as soon as possible, notify the master, in writing, of the amount payable.

Sub-Section (3): The master of a ship shall be liable for the tax notified under sub-section (2) and the provisions of this Ordinance shall apply to such tax as if it were tax due under an assessment order.

Sub-Section (4): Where the Commissioner is satisfied that the master of a ship or non-resident owner or charterer of the ship is unable to furnish the return required under sub-section (1) before the departure of the ship from a port in Pakistan, the Commissioner may allow the return to be furnished within thirty days of departure of the ship provided the non-resident owner or charterer has made satisfactory arrangements for the payment of the tax due under section 7 in respect of the ship.

Sub-Section (5): The Collector of Customs or other authorised officer shall not grant a port clearance for a ship owned or chartered by a non-resident person until the Collector or officer is satisfied that any tax due under section 7 in respect of the ship has been paid or that arrangements for its payment have been made to the satisfaction of the Commissioner.

Sub-Section (6): This section shall not relieve the non-resident owner or charterer of the ship from liability to pay any tax due under this section that is not paid by the master of the ship.

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