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Tag: Federal Board of Revenue

The Federal Board of Revenue is Pakistan’s apex tax agency, overseeing tax collection and policies. Pakistan Revenue is committed to providing timely updates on the Federal Board of Revenue to its readers.

  • Persons on ATL exempted from tax on cash withdrawal

    Persons on ATL exempted from tax on cash withdrawal

    ISLAMABAD: There is no withholding tax on cash withdrawal from banking system by a person, whose name is appeared on Active Taxpayers List (ATL), officials in Federal Board of Revenue (FBR) said on Friday.

    Under Section 231A of Income Tax Ordinance, 2001 the withholding tax rate is 0.6 percent for a person making cash withdrawal above Rs50,000 from banking system.

    However, this tax rate is only applicable on a person whose name is not appeared on ATL.

    For appearing on the ATL a person is required to file his annual income tax returns by due date prescribed by the FBR. In other cases the person can file his return after due date after payment of penalty to ensure his name on the ATL.

    The officials said that through Finance Supplementary (Second Amendment) Act, 2019 the government abolished 0.3 percent withholding tax rate on persons who were compliant in return filing.

    The Section 231A related to cash withdrawal from a bank said that every banking company shall deduct tax at the rate specified in Division VI of Part IV of the First Schedule, if the payment for cash withdrawal, or the sum total of the payments for cash withdrawal in a day, exceeds fifty thousand rupees.

    Explanation: For removal of doubt, it is clarified that the said fifty thousand rupees shall be aggregate withdrawals from all the bank accounts in a single day.

  • IR officers empowered to sell defaulters’ properties without attachment

    IR officers empowered to sell defaulters’ properties without attachment

    KARACHI: Officers of Inland Revenue (IR) have been empowered to sell moveable or immovable properties of sales tax defaulters for recovery of arrears.

    Section 48 of Sales Tax Act, 1990, which was updated up to June 30, 2019 by the Federal Board of Revenue (FBR) explained the powers of IR officers for recovery of arrears of tax.

    Section 48: Recovery of arrears of tax

    Where any amount of tax is due from any person, the officer of Inland Revenue may:-

    (a) deduct the amount from any money owing to person from whom such amount is recoverable and which may be at the disposal or in the control of such officer or any officer of Income Tax, Customs or Central Excise Department;

    (b) require by a notice in writing any person who holds or may subsequently hold any money for or on account of the person from whom tax may be recoverable to pay to such officer the amount specified in the notice;

    (a) stop removal of any goods from the business premises of such person till such time the amount of tax is paid or recovered in full;

    (ca) require by a notice in writing any person to stop clearance of imported goods or manufactured goods or attach bank accounts;

    (b) seal the business premises till such time the amount of tax is paid or- recovered in full;

     

    (c) attach and sell or sell without attachment any movable or immovable property of the registered person from whom tax is due; and

    (f) recover such amount by attachment and sale of any moveable or- immovable property of the guarantor, person, company, bank or financial institution, where a guarantor or any other person, company, bank or financial institution fails to make payment under such guarantee, bond or instrument:

    Provided that the Commissioner Inland Revenue or any officer of Inland Revenue shall not issue notice under this section or the rules made thereunder for recovery of any tax due from a taxpayer if the said taxpayer has filed an appeal under section 45B in respect of the order under which the tax sought to be recovered has become payable and the appeal has not been decided by the Commissioner (Appeals), subject to the condition that ten per cent of the amount of tax due has been paid by the taxpayer.

    (1A) If any arrears of tax, default surcharge, penalty or any other amount which is adjudged or payable by any person and which cannot be recovered in the manner prescribed above, the Board or any officer authorized by the Board, may, write off the arrears in the manner as may be prescribed by the Board.

     

    (2) For the purpose of recovery of tax, penalty or any other demand raised under this Act, the officer of Inland Revenue shall have the same powers which under the Code of Civil Procedure 1908 (V of 1908), a Civil Court has for the purpose of recovery of an amount due under a decree.

  • FBR transfers 11 senior IR officers of BS-20-21

    FBR transfers 11 senior IR officers of BS-20-21

    ISLAMABAD: Federal Board of Revenue (FBR) on Thursday notified transfers and postings of 11 senior officers of Inland Revenue Service (IRS) in BS-20-21 with immediate effect and until further orders.

    01. Dr. Ashfaq Ahmad Tunio (Inland Revenue Service/BS-21) has been transferred and posted as Member, Federal Board of Revenue (Hq), Islamabad from the post of Chief Commissioner, Regional Tax Office, Bahawalpur.

    02. Syed Maroof Gilani (Inland Revenue Service/BS-21) has been transferred and posted as Chief Commissioner Inland Revenue Regional Tax Office, Bahawalpur from the post of Member, Federal Board of Revenue (Hq), Islamabad.

    03. Qaiser Iqbal (Inland Revenue Service/BS-21) has been transferred and posted as Director General, Directorate General of Intelligence & Investigation (Inland Revenue), Islamabad from the post of Chief Commissioner, Regional Tax Office, Peshawar.

    04. Syed Nadeem Hussain Rizvi (Inland Revenue Service/BS-21) has been transferred and posted as Member, (TPA) Federal Board of Revenue (Hq), Islamabad from the post of Chief Commissioner, Corporate Regional Tax Office, Lahore.

    05. Asim Ahmad (Inland Revenue Service/BS-21) has been transferred and posted as Member, (IT) Federal Board of Revenue (Hq), Islamabad from the post of Director General, Directorate General of Intelligence & Investigation (Inland Revenue), Islamabad.

    06. Sardar Ali Khawaja (Inland Revenue Service/BS-21) has been transferred and posted as Chief Commissioner Inland Revenue Regional Tax Office, Peshawar from the post of Chief Commissioner, Regional Tax Office, Sargodha.

    7 Dr. Hamid Ateeq Sarwar (Inland Revenue Service/BS-21) is presently posted as Member, (Inland Revenue Policy Wing) Federal Board of Revenue (Hq), Islamabad, he is assigned the additional charge of the post of Member (FATE), Federal Board of Revenue (HQ), Islamabad in addition to his own duties, till the posting of a regular incumbent.

    08. Ms. Amina Hassan (Inland Revenue Service/BS-21) has been transferred and posted as Chief Commissioner Inland Revenue Corporate Regional Tax Office, Lahore from the post of Director General, (Special Initiative) Federal Board of Revenue (Hq), Islamabad. The officer is also assigned the additional charge of the post of Director General (Special Initiative), FBR (HQ), Islamabad in addition to her duties, till the posting of a regular incumbent.

    09. Abdul Hameed Memon (Inland Revenue Service/BS-21) has been transferred and posted as Director General, (Retail) Federal Board of Revenue (Hq), Islamabad from the post of Chief, (ST&FE) Federal Board of Revenue (Hq), Islamabad.

    10. Muhammad Imtiaz (Inland Revenue Service/BS-20) has been transferred and posted as Chief Commissioner Inland Revenue (OPS) Regional Tax Office, Sargodha from the post of Chief Coordinator, Chief Coordinator Computer Wing (Income Tax), Islamabad.

    11. Tariq Mustafa Khan (Inland Revenue Service/BS-20) has been transferred and posted as Chief Commissioner Inland Revenue (OPS) Regional Tax Office, Gujranwala from the post of Commissioner, Corporate Regional Tax Office, Karachi.

    The FBR said that the officers who are drawing performance allowance prior to issuance of this notification shall continue to draw this allowance on the new place of posting.

  • FBR appoints appraising, valuation officers

    FBR appoints appraising, valuation officers

    ISLAMABAD: Federal Board of Revenue (FBR) has appointed appraising and valuation officers (BS-16) in the Customs Department.

    A notification issued on Thursday, the FBR said that consequent upon the recommendations of Federal Public Service Commission (FPSC), Islamabad vide letter No.F.4-180/2018-R-FS-I, dated 17.10.2019 and having accepted the terms and conditions of appointment contained in the offer of appointment letter No.2(9)/2015-Cus-III, dated 22.10.2019, the following candidates are hereby appointed as Appraising/ Valuation Officer (BS-16) in the Customs Department and their services are placed at the disposal of Customs field formations mentioned against each:-

    01. Raafeh Nasar Chattha, Model Customs Collectorate (Appraisement) Lahore.

    02. Haris Bukhtiar Khan, Model Customs Collectorate (Appraisement) Lahore.

    03. Muhammad Ibrar Ibrahim, Model Customs Collectorate (Appraisement) Lahore.

    The FBR said that their inter-se-seniority will be maintained in order of merit assigned by Federal Public Service Commission (FPSC) and in accordance with the Civil Servants (Seniority) Rules, 1993.

    Other terms and conditions of their appointment will be the same as already conveyed vide FBR letter dated October 22, 2019.

    3. They are advised to join the concerned Customs field formation immediately but not later than 06.12.2019.

  • Non-ATL to pay 20 percent tax on property sale through auction

    Non-ATL to pay 20 percent tax on property sale through auction

    KARACHI: Properties sold through auction to attract 20 percent advance tax for persons not appearing on Active Taxpayers List (ATL).

    According to Income Tax Ordinance, 2001 updated till June 30, 2019 the advance tax rate on sale of property through auction would be 10 percent for persons, who filed their income tax returns by due date or filed after paying penalty.

    However, the tax rate has been prescribed at 20 percent for persons not appearing on the ATL.

    A taxpayer will only qualify for the ATL when he files annual income tax returns by due date or filed after due date with paying penalty.

    Through Finance Act, 2019 a new Tenth Schedule was introduced to Income Tax Ordinance, 2001 under which persons not appearing on ATL will pay 100 percent additional tax.

    Section 236 A of the Ordinance explained the advance tax at the time of sale by auction:

    Section 236A: Advance tax at the time of sale by auction

    Sub-Section (1): Any person making sale by public auction or auction by a tender, of any property or goods (including property or goods confiscated or attached) either belonging to or not belonging to the Government, local Government, any authority, a company, a foreign association declared to be a company under sub-clause (vi) of clause (b) of sub-section (2) of section 80, or a foreign contractor or a consultant or a consortium or Collector of Customs or Commissioner of Inland Revenue or any other authority, shall collect advance tax, computed on the basis of sale price of such property and at the rate specified in Division VIII of Part IV of the First Schedule, from the person to whom such property or goods are being sold.

    Sub-Section (2): The credit for the tax collected under sub-section (1) in that tax year shall, subject to the provisions of section 147, be given in computing the tax payable by the person purchasing such property in the relevant tax year or in the case of a taxpayer to whom section 98B or section 145 applies, the tax year, in which the “said date” as referred to in that section, falls or whichever is later.

    Explanation.- For the purposes of this section, sale of any property includes the awarding of any lease to any person, including a lease of the right to collect tolls, fees or other levies, by whatever name called.

    Sub-Section (3): Notwithstanding the provisions of sub-section (2), tax collected on a lease of the right to collect tolls shall be final tax.”

  • FBR starts air travelers’ monitoring to detect money launderers, drug smugglers

    FBR starts air travelers’ monitoring to detect money launderers, drug smugglers

    ISLAMABAD: Federal Board of Revenue (FBR) has launched passenger profiling system at international airports to curb money laundering and drug smuggling.

    A statement on Thursday said that Pakistan Customs, a wing of the FBR, has launched a specialized Risk Management System for passenger profiling at all major international airports in Pakistan.

    This exercise is part of the Customs Border Management Initiative (BMI) recently approved by the prime minister.

    The Passenger Profiling System, “Global Travelers Assessment System” (GTAS) is now operational at seven major airports of the country for which Customs staff has been adequately trained.

    Moreover, World Customs Organization (WCO) and US Customs and Border Protection (US CBP) have provided Technical assistance for deployment and implementation of the project.

    The system is capable of carrying out passenger profiling and targeting through Advance Passenger Information (API) and Passenger Name Record Information (PNR) for interdiction of suspected travelers, drug smugglers and money-launders etc. while adhering to the requirements of FATF action plan.

    It will also help in creating profiles of passengers travelling to and from Pakistan and generate risk indicators in advance using a proactive methodology for effective border management.

    According to Chairman FBR Syed ShabbarZaidi, the GTAS will also enable Customs to achieve the “Invisible Customs approach” with least presence at airports while facilitating the genuine passengers.

    The Chairman has also directed Member Customs Operations to ensure adequate training sessions for customs officers while initiating data sharing with border agencies which will serve as a targeting portal for all law enforcement agencies at Pakistan Customs National Targeting Centre.

  • FBR extends date for filing sales tax return

    FBR extends date for filing sales tax return

    ISLAMABAD: Federal Board of Revenue (FBR) on Wednesday extended the last date for filing sales tax return up to November 25, 2019.

    The FBR issued a circular dated November 20, 2019 and extended the date of submission of sales tax and federal excise return up to November 25, 2019 for the tax period of October 2019, which was due on November 18, 2019.

    The FBR directed all chief commissioners Inland Revenue of Large Taxpayers Units (LTUs) and Regional Tax Offices (RTOs) to comply with the instructions and disseminate information to taxpayers.

  • Income tax on low cost housing projects reduced by 50 percent

    Income tax on low cost housing projects reduced by 50 percent

    KARACHI: The income tax rate on low cost housing projects shall be reduced by 50 percent, according to income tax law recently updated by the Federal Board of Revenue.

    The FBR updated Income Tax Ordinance, 2001 incorporating changes introduced through Finance Act, 2019.

    As per Second Schedule of the updated Ordinance, the tax payable on profits and gains derived by a person from low cost housing projects shall be reduced by fifty percent.

    The reduction in tax liability under this clause shall apply to such project which is—

    (a) owned and managed by a company formed for operating the said project and registered under the Companies Act, 2017 and having its registered office in Pakistan; and

    (b) not formed by the splitting up, or the reconstruction or reconstitution, of a business already in existence or by transfer to a new business of any machinery or plant used in a business which was being carried on in Pakistan at any time before the commencement of the new business; and

    (c) a low cost housing project under which the maximum sale price of a single housing unit is two and a half million rupees.

  • Privileged personnel allowed duty, tax free car import

    Privileged personnel allowed duty, tax free car import

    KARACHI: Federal Board of Revenue (FBR) has granted duty, tax free import of cars to privileged personnel on first arrival in Pakistan.

    According to Customs Rules 2001 the expression “privileged personnel” means all foreign experts, consultants or technicians visiting and resident in Pakistan under a proper Aid Agreement in which provision for the application of these Customs concessions has been made.

    The expression includes only such personnel as are either directly in the employment of the foreign aid giving Government or Agency or who serve in Pakistan under contract or agreement with such Government or Agency and whose salaries and travelling expenses to and from Pakistan are paid by the foreign Government or Agency.

    It does not include personnel in the employment of the Federal or Provincial Government.

    The following customs concessions shall be extended to the privileged personnel, namely:-

    Import free of custom duty and sales tax of articles for the personal use of the privileged person or members of his family forming part of his personal and household effects including one car per family on his first arrival in Pakistan.

    The time limit for import will be six months, extendable by the Collector of Customs for a maximum period of 25[eighteen] months from the date of the arrival of the person concerned;

    In addition to the above, a privileged person shall be allowed to import on payment of duty and taxes foodstuff and consumable stores including liquor and tobacco up to a C&F value of two hundred U.S.$ per month but the value of liquor will not exceed one hundred U.S.$ per month.

    However, import of alcoholic beverages shall be subject to Import Policy Order.

    Note: The privileged personnel may import the monthly quotas prescribed in clauses (a) and (b) of rule 39, for a maximum period of six months at a time.

    Articles imported customs-duty and sales tax free shall normally be re-exported and shall not be sold or otherwise disposed of within Pakistan except with the prior approval of the Government or in terms of the regulations prescribed by the Government.

    If any other durable articles such as air-conditioners, refrigerators, deep freezers, VCR ,DVD, washing machines, etc., are disposed of in Pakistan, customs-duty and sales tax, etc., shall be payable on the original value at the rate applicable to the goods in question at the time of import.

    The privileged personnel shall be responsible for the payment of customs-duty and sales tax and other charges before parting with the articles; provided that no customs-duty and sales tax shall be payable if sold after three years from the date of import.

    In order to avail of the concessions under this chapter , a privileged personnel shall furnish to the Customs authorities a certificate duly signed by the Administrative Ministry of the Government of Pakistan concerned both in respect of personal and household effects, etc., imported on first arrival and subsequent monthly imports of foodstuffs, consumable stores, liquors, and tobacco in accordance with the prescribed quotas.

    The Administrative Ministry concerned shall verify that the conditions in the rules have been satisfied before issue of the certificate.

    The Administrative Ministry shall also be generally responsible to ensure that all the other conditions as per this chapter have been satisfied between the time of arrival and departure of privileged personnel:

    Provided that a foreign employee of an industrial venture shall be entitled to import free of customs-duties and other taxes food stuff (excluding alcoholic beverages) upto C&F value of one hundred US $ per month subject to the condition that he shall produce a certificate from his employer to the effect that he has been employed in his industrial venture in Pakistan for a specific year.

    The monthly quota may be imported for a period of six months at a time.

  • Income tax shall not exceed 10 percent of profit from saving schemes

    Income tax shall not exceed 10 percent of profit from saving schemes

    KARACHI: Tax laws have granted reduced rate of income tax on profit on investment in saving schemes.

    According to updated Income Tax Ordinance, 2001 up to June 30, 2019 issued by Federal Board of Revenue (FBR) defined reduction in tax liability for various segments of taxpayers.

    The ordinance said that the tax payable under clause (c) of sub-section (1) of section 39, in respect of any amount paid as yield or profit on investment in Bahbood Savings Certificate or Pensioners Benefit Account and Shuhada Family Welfare Account shall not exceed 10 percent of such profit.

    As per Second Schedule of the Ordinance, the income, or classes of income, or person or classes of person, enumerated below, shall be allowed reduction in tax liability to the extent and subject to such conditions as are specified hereunder:-

    (1) (1) Any amount received as-

    (a) flying allowance by flight engineers, navigators of Pakistan Armed Forces, Pakistani Airlines or Civil Aviation Authority, Junior Commissioned Officers or other ranks of Pakistan Armed Forces; and

    (b) submarine allowance by the officers of the Pakistan Navy, shall be taxed at 2.5 percent as a separate block of income:

    Provided that the reduction under this clause shall be available to so much of the flying allowance or the submarine allowance as does not exceed an amount equal to the basic salary.

    (1AA) Total allowances received by pilots of any Pakistani airlines shall be taxed at a rate of 7.5%, provided that the reduction under this clause shall be available to so much of the allowances as exceeds an amount equal to the basic pay.

    The tax payable by a full time teacher or a researcher, employed in a non profit education or research institution duly recognized by Higher Education Commission, a Board of Education or a University recognized by the Higher Education Commission, including government research institution, shall be reduced by an amount equal to 25 percent of tax payable on his income from salary:

    Provided that this clause shall not apply to teacher of medical profession who derive income from private medical practice or who receive share of consideration received from patients.

    The amount of tax payable, in a year in which the rupee is revalued or devalued, by a taxpayer whose profits or gains are computed in accordance with the rules contained in the Fifth Schedule to this Ordinance and who had entered with the Government into an agreement which provides for such reduction, shall be reduced to the amount that would be payable in the absence of the revaluation or devaluation of the rupee.

    In respect of old and used automotive vehicles, tax under section 148 shall not exceed the amount specified in Notification No. S.R.O. 577(I)/2005, dated the 6th June, 2005.

    The amount of tax payable by foreign film-makers from making films in Pakistan shall be reduced by fifty percent on income from film-making in Pakistan.

    The amount of tax payable by resident companies deriving income from film-making shall be reduced by seventy percent on income from film-making.