Principles of taxation of Association of Persons

Principles of taxation of Association of Persons

Section 92 of Income Tax Ordinance, 2001 has defined principles of taxation of Association of Persons (AOPs).

The Federal Board of Revenue (FBR) issued the Income Tax Ordinance, 2001 updated up to June 30, 2021. The Ordinance incorporated amendments brought through Finance Act, 2021.

Following is the text of Section 92 of the Income Tax Ordinance, 2001:

92. Principles of taxation of associations of persons.—(1) An association of persons shall be liable to tax separately from the members of the association and where the association of persons has paid tax the amount received by a member of the association in the capacity as member out of the income of the association shall be exempt from tax:

Provided that if at least one member of the association of persons is a company, the share of such company or companies shall be excluded for the purpose of computing the total income of the association of persons and the company or the companies shall be taxed separately, at the rate applicable to the companies, according to their share.

(Disclaimer: The text of above section is only for information. Team makes all efforts to provide the correct version of the text. However, the team is not responsible for any error or omission.)

Leave a Reply

You have to agree to the comment policy.