Tax Book 2023

Deduction / Payment of Tax Chapter- 23

deduction of tax at a reduced rate.

(U/C 5A of Part-II of Second Schedule) the rate of tax to be deducted u/s 152(2), in respect of payment from profit from debt payable to a non resident person having

no PE in Pakistan, other than those covered under clauses (78) and (79) of Part I of the Second Schedule,shall be 10% of the gross amount paid.

Provided that the tax deducted on profit on debt on instrument, government securities including treasury bills and Pakistan Investment Bonds shall be final tax on

profit on debt payable to a non resident person having no permanent establishment in Pakistan and the investments are exclusively made through a special rupees

convertible account maintained with the bank in Pakistan.

U/C (5AA)The rate of tax to be deducted under sub-section (2) of section 152, in respect of payments to an individual, on account of profit on debt earned from a debt

instrument, whether conventional or shariah compliant, issued by the Federal Government under the Public Debt Act, 1944 and purchased exclusively through a bank

account maintained abroad, a non-resident Rupee account repatriable (NRAR) or a foreign currency account maintained with a banking company in Pakistan shall be

10% of the gross amount paid:

Provided that tax deducted on such profit on debt shall be final tax.

NON APPLICABILITY OF PROVISIONS OF TAX AT SOURCE U/S 152 UNDER VARIOUS CLAUSES OF PART IV OF 2ND SCHEDULE TO THE ITO, 2001:

1. U/C 38C Islamic Development Bank.


2. U/C 67 The provisions of section 152 shall not apply in respect of payments made to the International Finance Corporation established under the
   International Finance Corporation Act, 1956.


3. U/C 69 The provisions of section 152 shall not apply in respect of payments made to the Asian Development Bank established under the Asian
   Development Bank Ordinance, 197 1.


4. U/C 72 Payments made to The ECO Trade and Development Bank.


5. U/C (72AA) The provisions of section 152 shall not apply in case of a Hajj Group Operator in respect of Hajj operations.

152A

Payment for foreign produced commercials

Omitted by Finance Act, 2001.

For

ATL

For

non

ATL

153 Sales of goods:^

153(1)(a)

For supply made to Utility Stores Corporation of

Pakistan:

Persons (other than company)

Provided that the payment shall be made only in respect

of supply of tea, spices, salt, dry milk, sugar, pulses wheat 1.5% 3%

Rs. 75 ,000

p.a.

See important

notes Federal Govt. Payment