ISLAMABAD: Procedure for obtaining certificate to get exemption from advance income tax on imported goods has been laid down in Income Tax Rules, 2002.
The FBR issued Income Tax Rules, 2002 (updated up to September 08, 2020) under which Rule 40D explains the procedure for exemption certificate.
Rule 40D: Import under an Exemption Certificate
(1) A taxpayer eligible under sub-section (1) of section 159 of the Ordinance may submit an application to the Commissioner for an exemption certificate through Iris, and submit supporting documents and data in electronic form:
Provided that till such time Iris is enabled for the purpose of this sub-rule, the application and supporting documents and data may be submitted manually to the Commissioner.
(2) On receipt of a complete application along with the documents prescribed under sub-rule (1), the Commissioner may carry out such verification as he may consider necessary to ascertain, inter alia, whether–
(a) such goods are relevant to the activity of the taxpayer whose income is exempt from tax under the Ordinance or is subject to hundred percent tax credit under section 100C of the Ordinance; and
(b) similar goods previously imported by the taxpayer have not been supplied to its associate or any other person in a non-arm’s length transaction.
(3) The Commissioner may, within fifteen days of application by the taxpayer through an order in writing,–
(a) approve such quantity of goods as it may deem fit to be imported by the person without collection of tax under section 148 of the Ordinance; or
(b) reject the application of the taxpayer.