Tax Book 2023

Tax Credits Chapter- 15

200,000

Income from business – Foreign source income

1 00,000

Less: Zakat deducted at source (6,000)

Taxable income 9 94,000

Share from AOP 150,000

Taxable income for rate purpose 1,144,000

As taxable salary income not exceeds 75% of the total taxable income, therefore the taxpayer is a

non salaried person for computation of tax liability as under.

Computation of tax liability:

Tax on Rs. 1,144,000 53 , 000

Total taxable income under NTR 53 , 000

Total tax liability under NTR as above 53 , 000

Less: foreign tax credit:

Lower of:

• Foreign tax paid 20,000


• Pakistan tax computed at average rate of tax
  ( 53 , 000 / 1,144,000 x 100,000 ) 4,633
  ( 4 , 633 )
  4 8, 367
  Less:

Tax credit on donation

[( 4 8, 367 / 1,144,000 x (12,000 + 90,000)] 4 , 312

Tax credit on investment in shares

( 4 8, 367 / 1,144,000 x 60,000 ) 2,537

( 6 , 849 )

41 , 518

Tax payable on income excluding share from AOP (Rs. 994 ,000 / 1,144,000

x 41,518)

36,074

Less: Senior Citizen Allowance @ 50% (no more available) 0

Less: full time teacher allowance [(36,074 x 600,000 / 99 4,000) x 25%] (5,444)

Balance tax payable 30 , 630

23. Tax credit for certain persons [Section 100C]

(1) The persons mentioned in sub-section (2) shall be allowed a tax credit equal to 100% of tax

payable under any of the provisions of this Ordinance including minimum and final

(a) taxes in respect of incomes mentioned in sub-section (3) subject to the conditions and

limitations laid down in subsection (4).

(2) The provisions of this section shall apply to the following persons, namely:—

a) persons specified in Table - II of clause (66) of Part I of the Second Schedule to this

Ordinance;

b) a trust administered under a scheme approved by the Federal Government and

established in Pakistan exclusively for the purposes of carrying out such activities as

are for the welfare of ex-employees and serving personnel of the Federal

Government or a Provincial Government or armed forces including civilian