Pakistan grants tax exemption to charitable organizations

Pakistan grants tax exemption to charitable organizations

KARACHI: Pakistan has granted exemption from tax on income of various charitable organizations through Finance Act, 2022.

The tax exemption has been granted under Second Schedule of Income Tax Ordinance, 2001.

READ MORE: New tax rates on car registration from July 01, 2022

According to interpretation of Finance Act, 2022 by PwC A. F. Ferguson & Co. the income of following organizations has been exempted from income tax by way of inclusion in Table I of Clause (66):

(i) The Pakistan Global Sukuk Programme Company Limited;

(ii) Karandaaz Pakistan from tax year 2015 onwards;

(iii) Public Private Partnership Authority for tax year 2022 and subsequent four tax years; and

(iv) Hamdard Laboratories (Waqf) Pakistan.

READ MORE: Finance Act 2022 notifies tax rates on disposal of securities

It is apt to mention here that income derived by The Pakistan Global Sukuk Programme Company Limited was earlier exempted from income tax through Notification SRO 1457(I)/2021 dated November 11, 2021; however, through the Act, such tax exemption has been ratified by the Parliament.

Further, the following Organizations, earlier entitled to tax exemption subject to fulfillment of conditions specified in section 100C of the Ordinance, are now extended unconditional tax exemption as was earlier available to them prior to Finance Act, 2020:

(i) Pakistan Mortgage Refinance Company Limited;

READ MORE: Finance Act 2022 revises tax rates for salaried persons

(ii) Pakistan Sweet Homes Angels and Fairies Place; and

(iii) Dawat-e-Islami Trust.

Further, the following Organizations have been extended tax exemption subject to fulfillment of conditions specified in section 100C:

(i) Burhani Qarzan Hasnan Trust;

(ii) Saifee Hospital Karachi; and

(iii) Safiyah Girls Taalim Trust.

READ MORE: Proposal of final tax regime for commercial importers rejected