Presented By Samra hanif kiani Sap: 20889 Business Bank Account A bank Account utilized by tax payer for business transactions. o Registration form is available on IRIS under section 181. o Declaring business account has been mandated under sec 114A. Tax Reduction • The Act insert a new clause (19) whereby reduction by 25% in tax payable is proposed for woman enterprises on profit and gains derived from business chargeable to tax under the head “Income from Business”. Concealment of Income (a)The suppression of any item (b)Claiming any deduction or any expenditure (c)Claiming of any income or receipt as exempt which is otherwise taxable . It is clarified that where any item of receipt declared by the taxpayer is claimed as exempt from tax, or where any deduction in respect of any expenditure is claimed, mere disallowance of such claim shall not constitute concealment of income. Losses in case of income from Property • Losses on income from property now adjustable against income from business. • A further incentive is provided in section 56 enabling taxpayers to set off business losses against income from property or vice versa. Surplus Funds • Not spent on charitable or welfare activities during the tax year. • Received during the year as donations, voluntary contributions, subscriptions and other incomes. • Which are more than twenty-five percent of total receipts of non-profit organization received during the tax year; and • Are not part of restricted funds. Resident Individual • In order to become a resident, a person shall be required to be in Pakistan for a period in • Aggregate to 183 days or more in a tax year. The other conditions have been waived off by • Omitting clause (ab) of section 82 of the Ordinance. Return of Income • The law provides for time limitation of 5 years for calling of return however, where • Taxpayer is a non-filer this limitation is 10 years. • Limitation shall not be applicable to a person who has foreign income or foreign assets. • Board with the approval of the Minister in charge has been empowered to notify persons, • or classes of persons who are required to file the return of income. Income from Property The Act has revised the withholding tax slab rates applicable in case of prescribed persons other than company on account of payment of rent of immovable property under section 155 of the Ordinance. Disposal of Immovable Property • The Bill also proposed to insert explanation in sub- section (1A) of section 37. • This proposed amendment has not been enacted. Salary Income • The Act has inserted explanation for the term the “allowance solely in the performance of employee’s duty” as provided in section 12(2)(c) not to include: • Allowance paid in monthly salary on fixed basis or percentage of salary; or • Allowance, which is not wholly, exclusively necessarily or actually spent on behalf of the employer.
