The Federal Board of Revenue (FBR) has only re-aligned existing provisions of section 153 (payments for goods and services and contracts) of the Income Tax Ordinance 2001 without changing the existing taxation regime under this section. The FBR has explained section 153 of the Income Tax Ordinance 2001 through an explanatory circular here on Tuesday.
According to the circular, the provisions of section 153 of the income Tax Ordinance, 2001 have been streamlined to provide clarity required due to numerous changes over the period of time. Only the existing provisions of this section have been re-aligned without changing the existing taxation regime under this section, it added.
Previously, deduction of tax by the Federal Government, Provincial Government or a Local Government while making payment to any person as profit on any security (other than yields on account deposit or a certificate under the National Saving Schemes or post office saving account) was not treated as final discharge of tax liability through Finance Act 2011, the deduction of tax on such profit on debt has been made a final tax. Now the tax deducted on profit on debt under section 151 of the Income Tax Ordinance, 2001 is a final tax.
In view of the problems reported by the taxpayers in payment of advance tax on Capital Gain on disposal of securities within prescribed time limit of seven days for payment, this limit has been increased to 21 days after the close of each quarter. However, the payment pertaining to the fourth instalment of advance tax in June is to be paid by June 30 each year, the circular added.