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Muhammad
Income Tax Law

Definitions

Total income

The total income of a person for a tax year shall be the sum of the person’s income under each of
the heads of income for the year. Following are the heads specified in the law for this purpose:

(a) Salary
(b) Income from property
(c) Income from business
(d) Capital gains
(e) Income from other sources

Pakistan source income

Income tax ordinance, 2001, has given consideration to the geographical source of income while
taxing any income. In this context the Pakistan-source income includes the income which a
person earns in Pakistan, irrespective of the fact that where it is actually received.

Foreign source income

This is a new concept, which has been introduced through the income tax ordinance, 2001.
According to the ordinance, an amount shall be foreign source income to the extent to which it is
not a Pakistan source income.

Tax

Tax means any tax imposed under the income tax law. It also includes any penalty, fee or other
charge or any sum or amount leviable or payable under the income tax ordinance, 2001.

Taxable income

The taxable income of a person for a tax year shall be the total income of the person for the year
as reduced by any deductible allowances. However, the taxable income should not be below
zero.

Taxpayer

Taxpayer means:

i. A person who derives an amount chargeable to tax


ii. Representative of such person
iii. A person responsible to deduct or collect tax and deposit it with the government under the
provisions of the income tax law;
iv. Any person required to furnish a return or pay tax under income tax ordinance, 2001.

Person

Under the income tax ordinance, 2001, a person includes the following:

i. An individual
ii. A company
iii. An association of persons incorporated, formed, organized or established in Pakistan or
elsewhere
iv. The federal government, a foreign government, a political sub-division of a foreign
government, or public international organization.

Company

According to the Income tax ordinance, 2001, ‘company’ means

i. A company as defined in the Companies Ordinance 1984


ii. A body corporate formed by or under any law in force in Pakistan
iii. A modaraba
iv. A body incorporated by or under the law of a country outside Pakistan relating to incorporation
of companies
v. A trust, a cooperative society or a finance society or any other society established under law
vi. A foreign association whether incorporated or not, which the central board of revenue has
declared to be a company
vii. A provincial government
viii. A local authority in Pakistan; or
ix. A small company.

Public company

Under income tax law a public company means:

i. A company in which at least fifty percent of the shares are held by the federal government or
provincial government.
ii. A company in which at least fifty per cent of the shares are held by a foreign government.
iii. A foreign company owned by a foreign government.
iv. A company whose shares were traded on a registered stock exchange in Pakistan at any time
ins the tax year and which remained listed on that exchange, at the end of that year: or
v. A unit trusts whose units’ arte widely available to the public and any other public trust.

Private company
Private company means a company, which is not a public company.

Banking Company

Banking company has the same meaning as in the banking companies ordinance, 1962 (LVII of
1962) and includes any body corporate which transacts the business of banking in Pakistan.

Business

“Business” includes any trade, commerce, manufacture, profession, vocation or adventure or


concern in the nature of trade, commerce, manufacture, profession or vocation, but does not
include employment.

Speculation business

A speculation business means any business in which a contract for the purchase and sale of any
commodity (including stock and shares) is periodically or ultimately settled otherwise than by the
actual delivery or transfer of the commodity.

Capital Asset

Capital asset means property of any king held be a person. It is immaterial whether the property
is connected with his business or not. However, the following are excluded form the definition:

i. Any stock in trade (not being stocks and shares), consumable stores or raw materials held for
the purpose of business.
ii. Any immovable property
iii. Personal effects of an individual like jewelry, clothes and household furniture.

Charitable purposes

Charitable purpose includes relief of the poor, education, medical relief and the advancement of
any other object of general public utility.

Dividend

Dividend includes:

i. Any distribution by a company of accumulated profits to its shareholders, whether capitalized or


not;
ii. Any distribution by a company7, to its shareholders of debentures, debenture sock or deposit
certificate in any form whether with or without profit, to the extent to which the company
possesses accumulated profits whether capitalized or not;
iii. Any distribution made to the shareholders of a company on its liquidation out of accumulated
profits of the company immediately before its liquidation, whether capitalized or not;
iv. Any distribution by a company to its shareholders on the reduction of its capital to the extent to
which the company possesses accumulated profit whether capitalized or not;
v. Any payment by a private company or trust of any sum by way of advance or loan to a
shareholder or any payment by any such company or trust on behalf, or for the individual benefit,
of any such shareholder to the extent to which the company or trust, in either case, possesses
accumulated profits;

Intangible

Intangible means any patent, invention, design or model, secret formula or process, copyright and
other properties and rights of the same kind. It also includes any other expenditure-incurred by a
business that provides:

i. Benefit or advantage for a period of more than one year; and


ii. The expenditure is not incurred to acquire a depreciable asset or unimproved land.

Minor child

Under the income tax ordinance, 2001, minor child means an individual who is under the age of
eighteen years. The age is to be determined at the end of a tax year.

Non-profit organization

Non-profit organization means any person the than an individual which is:

i. Established for religious, educational, charitable, welfare or development purposes or for the
promotion of an amateur sport;
ii. It should be registered under any law as a non-profit organization and the commissioner of
income tax has certified it to be a non-profit organization for a specified period, under the income
tax ordinance.
iii. Any asset of the organization should not be used for the private benefit of any other person.

Principal officer

Principal officer used with reference to a company or association of persons includes:

i. A director, a manager, secretary, agent, accountant or any similar officer, and


ii. Any person connected with the management or administration of the company or association of
persons upon whom the commissioner has served a notice4 of treating him as the principal
officer thereof

Resident and non-resident persons

Income tax ordinance, 2001, does not make any distinction on nationality or domicile basis; rather
tax liability of person is dete4mined on the basis of the fact that whether he is a resident or non-
resident person.

It must be noted that:


i. To be a resident or non-resident as used above has nothing to do with a dwelling place or
nationality, rather it is a term purely designed for tax purposes.
ii. The status of resident or non-resident is always associated with a particular income year
because it may change from year to year.
iii. A person’s status is determined with reference to the period of his stay (purpose of stay is
immaterial) in Pakistan in the tax year.
iv. The federal government is treated as resident.

For the purpose of income tax, all the persons are grouped under two categories:

i. Residents
ii. Non-residents

Resident individual

An individual will be a resident in Pakistan in any tax year if he fulfils any one of the following two
conditions:
1. He is in Pakistan for a period or periods amounting, in all, to 183 days or more.
2. He is an employee or official of the federal government or a provincial government posted
abroad in the tax.

Resident company

A company shall be a resident company for a tax year if it fulfills any one of the following
conditions:

i. It is incorporated or formed by or under any law in Pakistan;


ii. The control and management of the company is situated wholly in Pakistan at any time in the
year; or
iii. It is a provincial government or local authority in Pakistan.

Resident Association of persons

An association of persons shall be resident for any tax year if the control and management of the
affairs of the association is situated wholly or partly in Pakistan at any time in the year.

Resident persons

A person shall be a resident person for a tax year if the person is:

i. A resident individual, resident company or resident association of person for the year; or
ii. The federal government.

Non-resident persons

Under the income tax ordinance, 2001, a person shall be a non-resident person for a tax year if
the person is not a resident person for that year.

Non-resident taxpayers

A non-resident taxpayer means a taxpayer who is a non-resident person.

Reasons for distinguishing resident and non-resident person

There are two basic reasons due to which it is necessary to determine whether a person is a
resident or non-resident during the tax year.

Incidence of taxation

The income of a resident person is calculated by taking into account both the Pakistan-source
income and the foreign-source income.
The income of non-resident person is computed by taking into account only those amounts, which
are Pakistan-source income.

Rates of tax

There is a difference in rates of tax for residents and non-residents.

Salary

Salary means an amount received by an employee, from any employment

Stock in trade

Stock in trade means anything produced, manufactured, purchased, or otherwise acquired for
manufacture, sale or exchange and any materials or supplies to be consumed in the production
or manufacture process, but does not include stock or shares.

Taxation officer

The following are included in the definition of taxation officer:

i. Additional commissioner of income tax.


ii. Deputy commissioner of income tax
iii. Assistant commissioner of income tax
iv. Income tax officer
v. Special officer
vi. Any other officer with any designation appointed by the Federal Board of Revenue under
income tax ordinance, 2001.

Tax year

The concept of tax year has been introduced in income tax law through income tax ordinance,
2001. Tax year is a period of time for which tax is to be calculated regarding a person.

The tax year may be of three types:

1. Normal tax year

It is a period of twelve months ending on 30th June and is known by the calendar year in which
the ending date falls. Such a tax year is known as normal tax year.

2.Special tax year

In case of any person or class of persons or any source of income Federal Board of Revenue
may specify a period of twelve months as their tax year.
For example, in case of all companies manufacturing cotton textiles central board of revenue has
specified that their tax year will commence on 1st October and will end on 30th September
following

This period of 12 months is tax year for all companies engaged in cotton textiles manufacturing.
Such a tax year is called special tax year and is known by the calendar year relevant to normal
tax year in which the ending date falls.

3.Transitional tax year

When tax year of any class of persons or a single person is changed as a result of an order by
the Federal Board of Revenue or commissioner of income tax, it results in the emergence of a
changing period which is known as “transitional tax year” and is treated to be a separate tax year.
It consists of the period between the end of last year before change and the start of the changed
tax year.

Associates

This term has been introduced by finance ordinance, 2001. Two persons will be associates where
the relationship between the two is such that one may reasonably be expected to act in
accordance with the instructions of other or both persons may reasonably be expected to act in
accordance with the instructions of a third person, e.g.

1. An individual and his close relative;


2. Members of an association of persons;
3. a trust and any person who benefits from the trust;
4. a company and its shareholder who controls 50% or more voting power, right to dividend or
right to capital.

Royalties

Royalties mean any amount paid or payable as consideration for:

(a) The use of any patent, invention, design or model, secret formula or process, trademark or
any other property or right of this type;
(b) The use of or right to use any copyrights of a literary, artistic or scientific work including films
or videotapes for use in connection with television or tapes in connection with radio broadcasting.
However, consideration for the sale of cinema autograph films will not be treated as royalty;
(c) The receipt of, or right to receive, any visual images or sounds or both transmitted by satellite
cable, optic fiber or similar technology in connection with television, radio or internet
broadcasting;
(d) The supply of any technical, industrial, commercial or scientific knowledge, experience or skill;
(e) The use of, or right to use, any industrial, commercial or scientific equipment;
(f) The supply of any assistance that is subsidiary to any property or right mentioned above;

Industrial undertaking

This definition has been added through finance Act, 2004. An organization fulfilling the following
conditions will be known as industrial “undertaking”:
1. Organization is set up in Pakistan;
2. It uses electrical energy or any other form of mechanical energy and employs ten or more
persons; or
It does not use electrical or any other form of energy but:
(a) Employs twenty or more persons;
(b) Is engaged in a manufacturing process;
(c) Engaged in ship building;
(d) Engaged in generation, conversion, transmission or distribution of electrical energy, or the
supply of hydraulic power,
(e) Engaged in the working of any mine, oil well or any other source of mineral deposits.
Moreover, the central board of revenue can declare any other organization which does not fall in
the orbit of above two types as ‘ INDUSTRIAL UNDERTAKING”

Agricultural income

The agricultural income means income:

i. Derived from land;


ii. Land is situated in Pakistan; and
iii. Land is uses for agricultural purposes.

Thus, any income derived as rent, revenue, or from sale of any produce, which is grown on a
Pakistani land, is agricultural income. However, it is necessary to understand that the land must
be used for agricultural purpo9ses, which means that some human lab our and efforts are
necessary to be employed. If a produce is grown wild or spontaneously on land without any
human efforts or labour, it will not be treated as agricultural income under this definition.

Types of Agricultural Income

Agricultural income has been classified into five categories:


1. Rent or revenue derived from agricultural land.
2. Income derived from such land by agriculture.
3. Income derived from such land by the performance of a process ordinarily employed by a
cultivator or receiver of rent in kind to render the produce fit for market
4. Income derived from such land by the sale of produce by a cultivator or receiver of rent in kind.
5. Income derived from any building required for agricultural purposes.

The last category, i.e., income from agricultural building, will be treated as agricultural income
only, if:
(a) Building is in the immediate vicinity of agricultural land.
(b) Building is occupied by the cultivator or the recipient of agricultural income.
(c) The cultivator or recipient by reasons of his connection with the land requires it as a dwelling
house, storeroom or the out-building.

Examples of agricultural income

Some examples of agricultural income are as follows:


1. Rent received by lessor of agricultural land.
2. Income received by lessee of agricultural land by cultivation.
3. Income from cultivation of tobacco, wheat, sugarcane, rubber, etc.
4. Income from growing tea.
5. Land revenue assigned to jagirdar.
6. Income from building used for agricultural purposes.
7. Fee paid by tenant for renewal of lease,
8. Income from any land used for carrying on any process necessary to make the agricultural
produce fit for the market.
9. Income from sale of honey or its products.
10. Receipt of an amount for compromise of a dispute regarding agricultural land.

Examples of non- agricultural income

Some examples of non-agricultural income are as follows:


1. Income from stone quarries.
2. Income from fisheries and ferries.
3. Income from mining and mining royalties.
4. Income from land used as a market.
5. Income from a flourmill.
6. Income from land used for storing timber.
7. Income received from a cotton-ginning factory.
8. Profits from a contract of cutting and selling trees.
9. Income from sale of earth for brick making.
10. Income from markets.

Examples of partly agricultural and partly non-agricultural income

1. Income of a person who grown tea leaves on his own farms in Pakistan and then manufactures
it into tea.
2. Income of a sugar mill, which grows sugarcane and manufactures sugar.
3. Income of a cigarette company growing tobacco on its own land and manufacturing cigarettes.
In all the above cases, growing of crops (tea plants, sugarcane and tobacco respectively) is an
agricultural process fulfilling all the conditions of agricultural income. The second component of
these incomes is a manufacturing process and thus chargeable to tax under the head “Income
from business and profession”. In determining that part6 which is chargeable to tax, the market
value of any agricultural produce which has been raised by the person or received by him as rent
in kind and which has been utilized as raw material in such business, shall be deducted and no
further deduction in respect of any expenditure incurred by the person as a cultivator or receiver
of rent in kind will be allowed.

Accumulated Profits

The accumulated profits mean:

1. Any reserves maintained by a business out of its profits;

2. All profits of the company up to the date .

3. These profits kept in whatever shape, whethe4r capitalized or not, will be treated as
accumulated profits until their distribution to shareholders.

Appellate Tribunal

In case of any dispute between the taxpayers and tax department an appeal can be made to
appellate Tribunal. This is the highest judicial authority in the matters of tax. It consists of judicial
as well as accountant members. The members are appointed by the Federal Government. The
decision of the tribunal on point of facts is final. However, in case of point of law the matter may
be referred to high court.
Approved Gratuity Fund

The government and private organizations maintain gratuity funds for the benefit of their
employees. The amounts in these funds continue to accumulate from year to year and normally
are paid to employees at the time of retirement. In case of death of an employee during service,
the amount is paid to his family. The employer gets a lot of benefits if the gratuity fund is
approved by the income tax authorities under the income tax ordinance, 2001, the Commissioner
of income tax grants such an approval.

Approved Employment Pension or Annuity Scheme

Any employment related retirement scheme which makes pension or annuity payments to its
beneficiaries and is approved under income tax ordinance, 2001, are known as approved
employment pension or annuity scheme. Examples of such schemes include an approved
superannuation fund, a public sector pension scheme, employees old age benefit scheme, etc.

Approved Superannuation Fund

Superannuation funds are also maintained by the organizations to provide benefit to their
employees after retirement. The amount in this fund is continuously contributed by the employer.
These amounts are paid to the employees as annuities or pensions after their retirement or if they
become invalid before retirement, or to their families in case of death. The present government
has adopted a reasonable and liberal policy for the pension of widows and orphans of the
deceased employees. This amount is also paid out of the superanmnuation funds. under the
income tax ordinance, 2001, the commissioner of income tax approves such funds in which case
the amount contributed by an employer is treated as business expenditure, resulting in a
decrease in the tax payable.

Assessment

Assessment includes re-assessment and amended assessment and the cognate expressions
shall be construed accordingly.

Assessment Year

Assessment year means the period of 12 months beginning on the first day of July next following
the income year and includes any such period that is deemed under the provision of this
ordinance, to be the assessment year in respect of tax year.

Association of Persons

Association of persons includes a firm, a Hindu undivided family, and artificial judicial person and
any body of persons formed under a foreign law. However it does not include a company.

about 9 months ago


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Muhammad
Income Exempt from Tax
Question: What the legal provisions governing the exemption in respect of the following:

Two or three incomes are given and you are required to provide details.

Pension

a) Pension received by employees of Federal Government, Provincial Government and personnel


f Armed Forces of Pakistan is totally exempt from income tax.

b) Pension received from United Nation and its specialized agencies like WHO, UNESCO etc is
totally exempt.

c) Pension received by dependants of Shaheed is totally exempt.

d) Pension received by a citizen of Pakistan is totally exempt.

e) Pension is taxable if the person is re-employed by the same employer in any capacity under
any remuneration.

f) If a person is receiving pension from two different sources then the higher pension is exempt
and lower pension is taxable.

Salary of employees of Foreign Government

Salary of employees of foreign government is totally exempt subject to the following conditions:

a) The person concerned should be a national of that country and not a citizen of Pakistan.

b) His nature of duties should be similar to those of Pakistanis working in his country.

c) Such exemption is also available to Pakistanis working in their country.

Agricultural Income

Agricultural Income in completely exempt from tax

Scholarships

Any scholarship given to a person to meet the cost of person’s education is exempt from tax.
However, the scholarship should not be paid directly or indirectly by the associates.

Salary from British Council

Salary received by a person by virtue of his employment with the British Council is exempt from
tax provided that the recipient is not a citizen of Pakistan.

Encashment of Leave Preparatory To Retirement

Any sum representing encashment of leave preparatory to retirement received by an employee of


Armed Forces of Pakistan, Federal Government or Provincial Government is exempt.
Accumulated Balance of Provident Fund

An accumulated amount received by employee participating in a provident fund is exempt from


tax provided that is a Recognized Provident Fund or Government Provident Fund.

Facility of Accommodation

The facility of rent-free accommodation provided to the following persons is not taxable:

President of Pakistan
Provincial Governors
Chief of Staff of Pakistan Army, Navy and Air Force
Corpse Commanders
Federal Government Ministers
Judges of Supreme and High Courts

Special Allowance

If an employee receives a special allowance provided that it is not conveyance or entertainment


allowance) granted to meet the expenses which are incurred in the performance of official duties,
such allowance will be exempt from tax. Even if the expenses actually incurred are less than the
amount of allowance, the excess amount is not liable to tax. Example of such allowances are
Traveling Allowance, Daily Allowance, Uniform Allowance.

Special Additional Allowance


Government of Pakistan has allowed special additional allowance to its employees with effect
from July 1, 1999. For the employees up to grade 16, the allowance is paid as 25% of Minimum
Pay Scale whereas for employees of higher ranks the rate is 20%. This amount is totally exempt.

Income of Religious or Charitable Institutions

Income of religious or charitable institutions is exempt from tax provided

a) Such income is wholly spent or set apart to be spent on religious or charitable purposes.
b) Such amount is to be spent within Pakistan.

Compensatory Allowance Abroad

Facility of Conveyance and Entertainment Allowance

The facility of conveyance and entertainment allowance provided by the Government of Pakistan
to the following person is exempt from tax.

a) Provincial Governors
b) Chief of Staff of Armed Forces.
c) Corps Commanders
d) Ministers of Federal Government

Income of Local Authorities


Any income of a local authority is exempt from tax, but not being income from business carried on
by it outside its jurisdictional area.

Amount of Gratuity or Commutation of Pension

a) If any amount is received as gratuity or commutation of pension by an employee on his


retirement or by his heirs on his death, the exemption is provided according to the following rules:

b) If the amount is received from government, local authority, statutory body or corporation then
whole of the amount is exempt.

c) If the amount is received from gratuity fund approved by Commissioner of Income Tax then
whole of the amount is exempt.

d) If the amount is given by an organization which give the facility of gratuity to all its employees
then the gratuity is exempt up to Rs. 200,000/-

e) If the amount is received from an organization where (a), (b) and, (c) does not apply then Rs.
75000/- or 50% of the amount received whichever is lower, is exempt.

f) In the following cases, the amount received will be fully taxable.

• Amount received outside Pakistan


• Amount received by a director of a company from his company, if the director is not a regular
employee of the company.
• Amount of gratuity received by an employee who has already received gratuity from the same or
any other employer.

Income of Governments

(a) The income of federal government is fully exempt from tax.

(b) The income of provincial government or a local authority will also be exempt from tax provided
that the income is not derived from a business carried on outside its jurisdictional area.

(c) Any payment received by the federal government, or provincial Government or local authority
shall not be liable to any collection or deduction of advance tax.

Foreign Source Income of Certain Resident Individuals

The foreign source income of a resident individual will be exempt provided that:
(a) He is not a citizen of Pakistan;
(b) He has become a resident only due to his employment;
(c) His total stay in Pakistan does not exceed three years;
(d) The income is not derived by a business established by the person in Pakistan.
(e) The foreign source income brought into or received in Pakistan by the person will be taxable.

Foreign Source Income of Returning Expatriates

The foreign source income earned by a citizen of Pakistan who was not resident in any of the
preceding four years shall be exempt from tax. This income will exempt in the tax year in which
he became the resident and in the following tax year.
Moreover, when a citizen of Pakistan leaves the country during a tax year and starts an
employment abroad, the salary which he will earn during the year will be exempt from tax
provided that he remains abroad during the tax year.

Income of Foreign Employees of Agha Khan Development Network


Salary received by a person working as an expert, consultant, advisor or senior management
staff in Agha Khan Development Network is not taxable provided that he is not a citizen of
Pakistan.

Compensatory Allowance Abroad

The amount paid as compensatory allowance to the locally recruited employees in Pakistan
missions abroad is not taxable subject to fulfillment of following conditions:
(a) The employee is a citizen of Pakistan.
(b) Allowance up to 75% of gross salary of such an employee will be exempt.

Income of Textbook Boards


Income earned by the textbook boards of all the provinces is wholly exempt from tax.

Capital Gains

Capital gains received by the person from the sale of modarba certificates, any instrument of
redeemable capital as defined in the companies ordinance, 1984 (XLVII of 1984), listed on any
stock exchange in Pakistan, shares of public company or insurance company or the Pakistan
Telecommunication Corporation Vouchers issued by the Government are non-taxable up to tax
year 2010.

Export of Computer Software

Income from export of computer software or IT services or IT enabled services up to the period
ending on 30th day of June 2016 is exempt from tax.
Explanation
For the purpose of this clause:
(a) “IT enabled services” include software development, software maintenance, system
integration, web design, web development, web hosting and network design, and
(b) “IT enabled services” include inbound or outbound call centers, medical transcription, remote
monitoring, graphics design, accounting services, HR services, telemedicine centers, data entry
operations, locally produced television programmes and insurance claims processing.

about 9 months ago


#
Muhammad
Department of Commerce
F. G. College of Commerce
H-8/4, Islamabad

Business Taxation
Guidelines

I will introduce the subject first. It is Business Taxation. The course includes Income Tax Law and
Sales Tax. The income tax law is 60% of the course whereas Sales tax is 40% of the course. The
course can be divided into theory and practical problems. Approximately 60% of the course is on
theory and 40% of the course is on practical problems. What are these practical problems? They
are application of theory, When you know how to do something and you do it accordingly you are
applying the knowledge you have in a practical situation.

There will be two practical problems in your annual examination, one will be from Income Tax
Law and other will be from Sales Tax. The practical problem of Income Tax Law is compulsory
which means you have to attempt this question and four other questions as well. The practical
problem from sales tax is very simple and I am sure you would love to do it though it is not
compulsory.

One thing we must remember that we are discussing Business Taxation keeping in view the
requirements of B.Com-11 examination and are focusing on Tax Year 2009.

Income Tax Law

Definitions/Terminologies

There are 74 terms in this chapter. Normally three or four terms are required by the examiner to
be explained and there will certainly one question from this topic. The question would be like this

Define the following terms

i) Dividend
ii) Tax Payer
iii) Accumulated Balance of Provident Fund
iv) Principal Officer

Income Exempt from Tax

In this chapter those incomes are discussed which are either totally exempt from tax or partially
exempt from tax or exempt from tax subject to some conditions.

Normally there is one question from this topic and you are required to explain principles
governing the exemption in respect of two or three incomes. The question would be like this

What are the legal provisions governing the exemption in respect of the following

i) Income of employees of foreign government


ii) Gratuity or Commutation of Pension
iii) Income of Religious or Charitable Institutions

Heads of Income

There are five heads of income. Salary, Income from property, Capital Gains, Business Income
and Income from Other Sources. From this section there will be one question in your annual
examination. This section has added importance. If this section is quite clear to you only then you
can solve the compulsory income tax practical problem.

i) What are legal provisions governing the taxation of perquisites?

ii) What is Income from Property and what are the allowable deductions under the head “Income
from Property”

iii) What are capital gains and how they are taxed.

iv) What are allowable business expenditures. Explain in detail.

v) Explain non admissible expenditures in detail.

vi) What are various types of depreciation and what are the conditions for allowability of
depreciation?

Income Tax Authorities /Appeals and Revisions

There will one questions from this section. These questions are very simple and you will
understand these question if you simply attend the class and read these questions afterward.

i) Define the powers and functions of Federal Board of Revenue


ii) Define the role and functions of Commissioner of Income Tax
iii) Define the role and functions of Deputy Commissioner of Income Tax
iv) What is the procedure of filing an appeal before Commissioner of Income Tax (Appeals)
v) What is the procedure of filing an appeal before Appellate Tribunal?
Assessment Procedure /Self Assessment Scheme

Normally there is one question from this topic.

Explain the legal provisions governing the filing of Return of Total Income.
Explain assessment procedure in detail.
What are various types of Assessment
What are the salient features of Self Assessment Scheme.

Set off and Carry Forward of Losses /Fines and Penalties /Tax Accounting
Write short note on the following
i) Set off of losses
ii) Carry Forward of losses

What penalties are imposed in respect of the following


i) Concealment of Income
ii) Failure to give notice for discontinuation of business
iii) Obstructing an Income Tax Authority

Practical Problem

A compulsory practical problem from Income Tax Law.

Sales Tax

Definitions
Normally one question from this chapter is set in the examination. So do all the definitions The
question from this topic would be like this.

Define and explain the following terms with reference to sales tax Act
i) Arrears
ii) Manufacturer
iii) Supply
iv) Tax Invoice

Sales Tax Practical Problem


There will be one practical problem from this section. This problem is very simple and I am sure it
is designed keeping in view the capability of the students of B.Com Any how you would love to do
it.
Hello sir i m muhammad adil from B.Com part 2 section A.Sir i have sent to some importent
question of businees law which is prepared by Prof.Ahmed Bilal Ch.from hiellay kolege of
commerce.
Q,1:Define Contract?Discuss essential of Valid contract.
Q.2:What is free concent?Discuss the element and position of contract when the consent is not
free.
Q.3:What is Considration?Discuss its important rules and elements and also explain it exception.
Q.4:What is bailment?Explain the various right and duties of Bailer and Bailee.
Q.5:What are agreements,which have been expressly declared by law tobe void.
Q.6;What is contract?Give kinds of contracts.
Q7:WHAT do you understand by capacity of contract?What are the effects if agreements made
by person not competent to contract.
Q8:All contract are agreement but all agreement is not contract?Discuss this statement.
Q.9:What is contract of sales?Also makes a difference between Sale and Agreement of sale.
Q.10:Define cheque and bill of cxchange?Draw specimen.Diffrence between these two.
Q.11:Make a difference between cheque,bill of exchange and promissary notes.
Q.12:What is common carrier?Discuss its importants elements rights and duties.
Q.13:The railway is not a common carrier so gar as its liabilites are concerned.Discuss the
statement.
Q.14:What is carriage?Give rights and duties of common carrier.
Q.15:Make a diffrence between Common and private carrier,Bill of lading and charter party.
Q.16:What are the power and function of national industrial relation commission?

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