Withholding Tax Card 2016/2017: advance tax on use of machinery and equipment

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KARACHI: Federal Board of Revenue (FBR) has updated advance tax to be collected for use or right to use industrial, commercial and scientific equipment during 2016/2017.
Payment to residents for use of machinery and equipment under section 236Q of Income Tax Ordinance, 2001.
Sub-Section (1): Every prescribed person making a payment in full or in part including a payment by way of advance to a resident person for use or right to use industrial, commercial and scientific equipment shall deduct tax from the gross amount at 10 percent.
Sub-Section (2): Every prescribed person making a payment in full or in part including a payment by way of advance to a resident person on account of rent of machinery shall deduct tax from the gross amount at 10 percent.
Sub-Section (3): The tax deductible under sub-sections (1) and (2) shall be final tax on the income of such resident person.
Sub-Section (4): In this section ―prescribed person means a prescribed person as defined in sub-section (7) of section 153.
(5) The provisions of sub-section (1) and (2) shall not apply to—
(a) agricultural machinery; and
(b) machinery leased by a leasing company, an investment bank or a modaraba or a scheduled bank or a development finance institution in respect of assets owned by the leasing company or an investment bank or a modaraba or a scheduled bank or a development finance institution.

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