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Tag: foreign assets

  • Transfer of foreign assets required to be declared in annual return

    Transfer of foreign assets required to be declared in annual return

    ISLAMABAD: A person makes transaction or transfer of foreign assets during a tax year is required to declare the same in annual return.

    Officials in the Federal Board of Revenue (FBR) said that according to Income Tax Ordinance, 2001 a person having foreign assets or foreign income is required to file annual return of income and wealth statement.

    The law also makes mandatory for the person to declare any foreign assets transferred to any other person during the tax year and the consideration for the said transfer.

    Section 116A of the Income Tax Ordinance, 2001 explains the return filing requirement for a person having foreign income and assets statement.

    Section 116A. Foreign income and assets statement.

    (1) Every resident taxpayer being an individual having foreign income of not less than ten thousand United States dollars or having foreign assets with a value of not less than one hundred thousand United States dollars shall furnish a statement, hereinafter referred to as the foreign income and assets statement, in the prescribed form and verified in the prescribed manner giving particulars of—

    (a) the person’s total foreign assets and liabilities as on the last day of the tax year;

    (b) any foreign assets transferred by the person to any other person during the tax year and the consideration for the said transfer; and

    (c) complete particulars of foreign income, the expenditure derived during the tax year and the expenditure wholly and necessarily for the purposes of deriving the said income.

    (2) The Commissioner may by a notice in writing require any person being an individual who, in the opinion of the Commissioner on the basis of reasons to be recorded in writing, was required to furnish a foreign income and assets statement under sub-section (1) but who has failed to do so to furnish the foreign income and assets statement on the date specified in the notice.

  • Return filing mandatory for Pakistanis having foreign assets

    Return filing mandatory for Pakistanis having foreign assets

    ISLAMABAD: Pakistanis having income and assets abroad are required to file annual income tax return under Section 114 of the Income Tax Ordinance, 2001.

    According to Section 114 of the Ordinance the return filing is mandatory for: “(x) is a resident person being an individual required to file foreign income and assets statement under section 116A.”

    The Section 116A of the Ordinance was introduced through Finance Act, 2018.

    According to this section every resident taxpayer being an individual having foreign income of not less than ten thousand United States dollars or having foreign assets with a value of not less than one hundred thousand United States dollars shall furnish a statement, hereinafter referred to as the foreign income and assets statement, in the prescribed form and verified in the prescribed manner giving particulars of—

    (a) the person’s total foreign assets and liabilities as on the last day of the tax year;

    (b) any foreign assets transferred by the person to any other person during the tax year and the consideration for the said transfer; and

    (c) complete particulars of foreign income, the expenditure derived during the tax year and the expenditure wholly and necessarily for the purposes of deriving the said income.

  • Amnesty shows 91pc assets declarants are registered

    Amnesty shows 91pc assets declarants are registered

    ISLAMABAD: The Amnesty Scheme 2018 has shown the 91 percent tax dodgers, who availed the scheme for declaring undisclosed foreign assets were registered with tax department.

    According to presentation of the finance ministry on the previous tax amnesty scheme, the analysis showed around 6,195 persons availed the scheme to declare foreign assets.

    It revealed that out of total declarants of foreign assets around 5,625 were already income tax return filers and registered with the Federal Board of Revenue (FBR).

    Only 570 declarants of foreign assets were those who had file their returns for the first time.

    In the last scheme black money/undeclared assets of around Rs1,060 billion was whitened out of that declaration the FBR got only Rs47 billion as tax revenue. The average tax rate to document the undisclosed foreign assets was 4.43 percent.

    Only Rs6.42 billion worth foreign assets were repatriated under the amnesty scheme. While another Rs3.34 billion was investment into the government securities availing the amnesty scheme.

    The finance ministry said that amnesty scheme 2018 for undisclosed foreign assets was mostly availed by filers.

    Foreign amnesty scheme declaration showed 25 percent declarations in immovable properties mainly in UAE, UK and Canada.

    It also revealed that people preferred to keep money outside Pakistan.

    The documentation of domestic assets/cash declared under the amnesty scheme 2018 was stood at Rs1,503 billion by 76,952 persons. The FBR received an amount of Rs75 billion as tax revenue.

    Interestingly, the quantum of black money invested in prize bonds and cash was 65 percent out of domestic assets that was whitened under the amnesty scheme.

    The analysis showed that local scheme was primarily used for money whitening. It is further identified that amnesty did not lead to higher number of tax payments for return for return of tax year 2018.

    It said that undisclosed properties and bank accounts still remain largely undisclosed.