The rate of tax imposed on the taxable income of a company other than a banking company, shall be 34 percent for the Tax Year 2014 under Finance Act 2013. The income tax circular issued on Friday said that through Finance Act, 2013 a proviso has been added to Division II of Part-I in the First Schedule to the Income Tax Ordinance, 2001 providing that the rate of tax imposed on the taxable income of a company other than a banking company, shall be 34 percent for the tax year 2014.
This means that the rate of Income Tax for the Tax Year 2013 shall be 35 percent and for the Tax Year 2014 the rate of income tax shall be 34 percent on the taxable income of a company other than a banking company. Explaining the Cash Withdrawal from a bank (Section 231A], the FBR said that the rate of deduction of income tax by every banking company has been increased to 0.3 percent.
The NCCPL shall now collect advance tax at the rate of 10 percent from margin financiers, trading financiers and lenders in addition to the members of Stock Exchange registered in Pakistan in respect of margin financing or providing of any margin financing, margin trading or securities lending under Securities (Leveraged Markets and Pledging) Rules, 2011 in share business. However the provisions of section 233AA shall not apply to any Mutual Fund specified in sub-clause (2) of clause (57) of Part I of the Second Schedule to the Income Tax Ordinance, 2001, the FBR said. Through Finance Act, 2013 the rate of tax under section 156 has been increased from 10 percent to 15 percent.
Through an amendment in section 8 and corresponding amendment in Section 169 of the Income Tax Ordinance, 2001 dividend received by a corporate taxpayer is now taxable at the rate of 10 percent as fixed and final tax. Through Finance Act, 2013 a person sustaining a loss in any head of income as specified in section 11 cannot set off such loss against income under the head salary or income from property.
Through an 'Explanation' to sub-section (2) of section 171 it has been explained to preclude the possibility of varying interpretations that where a refund order is made on an application under sub-section (1) of section 170, for the purpose of compensation, the refund becomes due from the date the refund order is made and not from the date the assessment of income is treated to have been made by the Commissioner under section 120 of the Income Tax Ordinance, 2001.
Through Finance Act, 2013 it has been explained that 'business connection' includes transfer of an asset or business in Pakistan by a non-resident to the representative of the person for the purposes of the Income Tax Ordinance, 2001, the FBR added.
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