AGL 40.00 Decreased By ▼ -0.16 (-0.4%)
AIRLINK 129.53 Decreased By ▼ -2.20 (-1.67%)
BOP 6.68 Decreased By ▼ -0.01 (-0.15%)
CNERGY 4.63 Increased By ▲ 0.16 (3.58%)
DCL 8.94 Increased By ▲ 0.12 (1.36%)
DFML 41.69 Increased By ▲ 1.08 (2.66%)
DGKC 83.77 Decreased By ▼ -0.31 (-0.37%)
FCCL 32.77 Increased By ▲ 0.43 (1.33%)
FFBL 75.47 Increased By ▲ 6.86 (10%)
FFL 11.47 Increased By ▲ 0.12 (1.06%)
HUBC 110.55 Decreased By ▼ -1.21 (-1.08%)
HUMNL 14.56 Increased By ▲ 0.25 (1.75%)
KEL 5.39 Increased By ▲ 0.17 (3.26%)
KOSM 8.40 Decreased By ▼ -0.58 (-6.46%)
MLCF 39.79 Increased By ▲ 0.36 (0.91%)
NBP 60.29 No Change ▼ 0.00 (0%)
OGDC 199.66 Increased By ▲ 4.72 (2.42%)
PAEL 26.65 Decreased By ▼ -0.04 (-0.15%)
PIBTL 7.66 Increased By ▲ 0.18 (2.41%)
PPL 157.92 Increased By ▲ 2.15 (1.38%)
PRL 26.73 Increased By ▲ 0.05 (0.19%)
PTC 18.46 Increased By ▲ 0.16 (0.87%)
SEARL 82.44 Decreased By ▼ -0.58 (-0.7%)
TELE 8.31 Increased By ▲ 0.08 (0.97%)
TOMCL 34.51 Decreased By ▼ -0.04 (-0.12%)
TPLP 9.06 Increased By ▲ 0.25 (2.84%)
TREET 17.47 Increased By ▲ 0.77 (4.61%)
TRG 61.32 Decreased By ▼ -1.13 (-1.81%)
UNITY 27.43 Decreased By ▼ -0.01 (-0.04%)
WTL 1.38 Increased By ▲ 0.10 (7.81%)
BR100 10,407 Increased By 220 (2.16%)
BR30 31,713 Increased By 377.1 (1.2%)
KSE100 97,328 Increased By 1781.9 (1.86%)
KSE30 30,192 Increased By 614.4 (2.08%)

The advance tax would be applicable on persons remitting amounts abroad through credit cards, debit cards or prepaid cards and ATM cards under Section 236Y of the Income Tax Ordinance 2001 and all plastic cards which are categorized as debit, credit or prepaid cards are covered in this section.
Through income tax circular 3 of 2018 issued by the FBR here on Thursday, the FBR has explained advance tax on persons remitting amounts abroad through credit cards, debit cards or prepaid cards [Section 236y].
The FBR said that the credit, debit and prepaid cards are being used as a mode to pay for foreign travel, lodging, shopping, etc, and for online shopping from merchants outside Pakistan. Through the Finance Act, 2018, a new section 236Y has been inserted in the Income Tax Ordinance, 2001 which requires every banking company to collect advance tax at the time of transfer of any sum remitted outside Pakistan on behalf of a person who has completed a debit card or credit card or prepaid card transaction with a person outside Pakistan. The advance tax collected under this section shall be adjustable. The rate of tax to be deducted shall be 1% of the gross amount remitted abroad from filers and 3% from non-filers.
The following transactions are included in this section:- Use of credit card, debit card or prepaid card in Pakistan where the transaction is with a person outside Pakistan and results in transfer of sum remitted outside Pakistan. Secondly, use of credit card, debit card or prepaid card outside Pakistan where the transaction is with a person outside Pakistan and results in transfer of sum remitted outside Pakistan. Thirdly, use of ATM card outside Pakistan which results in transfer of any sum remitted outside Pakistan.
All plastic cards which are categorized as debit, credit or prepaid cards are covered in this section. As ATM cards are mostly debit cards or in some cases can also be credit or prepaid cards, transactions of cash withdrawal using ATM cards outside Pakistan are also covered in this section if such transactions result in transfer of any sum remitted outside Pakistan, the FBR added.

Copyright Business Recorder, 2018

Comments

Comments are closed.