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Tag: tax default

  • All members of AOP responsible to pay tax default

    All members of AOP responsible to pay tax default

    KARACHI: Any tax payable by an Association of Persons (AOP) was not recovered in such case every person of the AOP shall be jointly and severally responsible for payment of the tax due.

    Officials of Federal Board of Revenue (FBR) said that through Finance Act, 2019 the amendment made to Section 139 of Income Tax Ordinance, 2001 to make responsible every person of an AOP for default payment.

    The Section 139 says:

    Section 139: Collection of tax in the case of private companies and associations of persons

    (1) Notwithstanding anything in the Companies Ordinance, 1984 (XLVII of 1984), where any tax payable by a private company (including a private company that has been wound up or gone into liquidation) in respect of any tax year cannot be recovered from the company, every person who was, at any time in that tax year —

    (a) a director of the company, other than an employed director; or

    (b) a shareholder in the company owning not less than ten per cent of the paid-up capital of the company, shall be jointly and severally liable for payment of the tax due by the company.

    (2) Any director who pays tax under sub-section (1) shall be entitled to recover the tax paid from the company or a share of the tax from any other director.

    (3) A shareholder who pays tax under sub-section (1) shall be entitled to recover the tax paid from the company or from any other shareholder to whom clause (b) of sub-section (1) applies in proportion to the shares owned by that other shareholder.

    (4) Notwithstanding anything in any law, where any tax payable by a member of an association of persons in respect of the member’s share of the income of the association in respect of any tax year cannot be recovered from the member, the association shall be liable for the tax due by the member.

    (5) Notwithstanding anything contained in any other law, for the time being in force, where any tax payable by an association of persons in respect of any tax year cannot be recovered from the association of persons, every person who was, at any time in that year, a member of the association of persons, shall be jointly and severally liable for payment of the tax due by the association of persons.

    (6) Any member who pays tax under sub-section (5) shall be entitled to recover the tax paid from the association of persons or a share of the tax from any other member.

    (7) The provisions of this Ordinance shall apply to any amount due under this section as if it were tax due under an assessment order.

  • IR barred from arresting women on tax default

    IR barred from arresting women on tax default

    KARACHI: The offices of Inland Revenue are prohibited for arresting women on charge of tax default. Besides, the offices also cannot arrest a minor.

    According to Income Tax Rules, 2002 there is prohibition against arrest of woman or minor.

    The commissioner of Inland Revenue shall not order the arrest or detention in the civil prison of: a woman; or any person who, in his opinion, is a minor or of unsound mind.

    The rules also envisaged certain conditions on IR officers regarding entry into dwelling house for arresting tax defaulter.

    For the purpose of making an arrest under these rules,-

    (a) no dwelling house shall be entered after sunset and before sunrise;

    (b) no outer door of a dwelling house shall be broken open unless such dwelling house or a portion thereof is in the occupancy of the defaulter and he or any other occupant of the house refuses or in any way prevents access thereto; but, when the person executing any such warrant has duly gained access to any dwelling house, he may break open the door or any room or apartment if he has reason to believe that the defaulter is likely to be found there; and

    (c) no room, which is in the actual occupancy of a woman who, according to the custom of the country, does not appear in public shall be entered into unless the officer authorized to make the arrest has given notice to her that she is at liberty to withdraw and has given her reasonable time and facility for withdrawing.

    In case of illness of a tax defaulter the commissioner can release by cancelling the warrant for the arrest.

    Release on ground of illness.-

    (1) At any time after a warrant for the arrest of a defaulter has been issued, the Commissioner may cancel it on ground of the serious illness of the defaulter.

    (2) Where a defaulter has been arrested, the Commissioner may release him if, in the opinion of the Commissioner of Tax, he is not in a fit state of mind to be detained in the civil prison.

    (3) Where a defaulter has been committed to the civil prison, he may be, released therefrom by the Commissioner on the ground of the existence of any infectious or contagious disease or on the ground of his suffering from any illness.

    (4) A defaulter released under this rule may be re-arrested, but the period of his detention in the civil prison shall not in the aggregate exceed that authorized by rule 164.