Collection & Deduction of Income Ax

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Collection
and
Deduction
of Income Tax
at Source
(Withholding Agents
Perspective)
(Taxpayer’s Facilitation Guide)

Brochure – IR-IT-04
July 2011
Revenue Division
Federal Board of Revenue
Government of Pakistan

helpline@fbr.gov.pk
0800-00-227, 051-111-227-227
www.fbr.gov.pk

Our Vision
To be a modern, progressive, effective,
autonomous and credible organization for
optimizing revenue by providing quality
service and promoting compliance with tax
and related laws

Our Mission
Enhance the capability of the tax system to
collect due taxes through application of
modern techniques, providing taxpayer
assistance and by creating a motivated,
satisfied, dedicated and professional
workforce

Our Values
Integrity
Professionalism
Teamwork
Courtesy
Fairness
Transparency
Responsiveness
For assistance and information on tax matters
Please contact our help line center through
Toll Free Telephone 0800-00-227
Telephone 051-111-227-227 or 051-111-227-228
Fax 051- 051-9205593
E-mail helpline@fbr.gov.pk
or
Visit our tax facilitation center (located in all major cities) or any tax office or
Visit our website at www.fbr.gov.pk

Revenue Division
Federal Board of Revenue
Government of Pakistan

Section

Brochure – IR-IT-04

148
149
150
151

July 2011

INTRODUCTION
Income Tax Ordinance, 2001 makes it obligatory
to collect and deduct tax at source on certain
specified persons (listed in cross index
withholding agent wise), commonly known as
―Withholding Agents‖ at a time when an
economic activity takes place.. This brochure
explains the provisions of the Income Tax
Ordinance, 2001 governing withholding tax in a
simple and concise manner. It mainly revolves
around the obligations of the withholding agents
as to collection or deduction of tax at source, i.e. –
o
o
o
o
o
o
o
o
o

152

153

Identifying the withholding agents;
Persons from whom tax is to be deducted or
collected;
Applicable rates of withholding taxes;
Basis of withholding tax;
Time of deduction;
Time of deposit of tax deducted or collected in
the account of Federal Government;
Frequency and time of submitting the
statements of tax deducted or collected;
Applicable exemptions and reduced rates;
and
Liabilities of the withholding agents and
consequences of non-compliance.

153A
154

155
156
156A

A cross-index of different tax withholding agents
and the corresponding applicable provisions of
law is also given for quick and easy reference.

156B
231A
231AA
231B
233
233A

This brochure has been arranged section wise.
Definitions
of
various
expressions
and
terminologies used shown in italic bold are given
at the end of this brochure.
This brochure is to assist the taxpayers and reflect the
legal position at the time of printing. In case of any
conflict the legal provisions of the law shall always
prevail over the contents of this brochure.

234
234A
235
236
236A
236B

Comments and suggestions
We welcome your comments about this brochure and your
suggestions for future editions.

You can e-mail us at memberfate@fbr.gov.pk
or
You can write to us at the following address:
Facilitation and Taxpayer Education
Federal Board of Revenue,
Constitution Avenue,
Islamabad

Contents

Page

Import of goods
Payment of salary
Payment of dividend
Payment of profit on debt
On National Savings Schemes or Post
Office Savings Account
On account or deposit with banking
company or financial institution
On securities of the Federal and
Provincial Governments or a Local
authority
On bond, certificate, debenture,
security or instrument of any kind
Payment to non-resident
Royalty and fee for technical services
Execution of contracts etc.
Insurance or re-insurance premium
Other payments
Payment for goods; services and
execution of contracts
Sale of goods, services rendered or
provided and execution of a contract
(Residents
and...
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