The Federal Board of Revenue (FBR) has expanded the scope of definition of company by including co-operative society, finance society or any other society; non-profit organisation; trust, an entity or a body of persons established or constituted by or under any law in force for the time being.
The FBR's income tax circular on Friday elaborated an amendment made through Finance Act, 2013 to enlarge the scope of a company's definition. Now as per Income Tax Ordinance, 2001 a company includes: A co-operative society, a finance society or any other society; a non-profit organisation; a trust, an entity or a body of persons established or constituted by or under any law in force for the time being. Now the provisions of the Income Tax Ordinance, 2001 applicable to companies shall also apply on the above mentioned classes of co-operative societies and non-profit organisations too.
Through Finance Act, 2013 a proviso has been added to sub-section (1) of Section 111 of the Income Tax Ordinance, 2001 providing that where a taxpayer explains the nature and source of the amount credited or the investment made, money or valuable article owned or funds from which the expenditure was made, by way of agricultural income, such explanation shall be accepted only to the extent of agricultural income worked back on the basis of agricultural income tax paid subject to furnishing of proof of payment of agriculture tax under the relevant provincial law.
The rate of Minimum tax under section 113 on the income of certain persons has been changed from 0.5percent to 1 percent. Prior to Finance Act, 2013 carrying forward of excess amount of tax paid than the actual tax payable under section 113 was available to companies only. Now this facility has been extended to individuals and association of persons and they can also carry forward the excess amount of tax paid as per provisions of section 113.
The time limit of sixty days for provisional assessment to attain finality as the final assessment order from the date of service of order of provisional assessment and the limitation of sixty days in the subsequent provisos to sub-section (2) of section 122C has been reduced to forty five days through Finance Act, 2013, FBR added.