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Income Tax (Amendment) Ordinance, 2018, as published 2018

This is the Income Tax (Amendment) Ordinance, 2018, as published by the Federal Board of Revenue in 2018. It runs to 6 pages.

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M 302 REGISTERED No. L-,646 EXTRAORDINARY PUBLISHED BY AUTHORITY ISLAMABAD,S UNDAY,A PRIL 8, 2018 PART I Acts, Ordinances, President’s Ordevs and Regulations GOVERNMENT OF PAKISTAN MINISTRY OF LAW AND JUSTICE Islamabad, the 8th April, 2018 No. F. 2 (l)/2018-pub.-The following Ordinance promulgated by the President is hereby published for general information:- ORDINANCE firrther to amend the Income Tax Ordinance, 2001 WHEREASit is expedient further to amend the Income Tax Ordinance, 2001 (XLIX of 2001) for the purposes hereinafter appearing; (155) Price: Rs. 5.00 [5656(20 18)IEx. Gaz.].

AND WHEREAS, the Senate and the National Assembly are not in session and the President of the Islamic Republic of Pakistan is satisfied that circumstances exist which render it to take immediate action; . . of the Islamic Republic of Pakim. is p- to make and promulgate the . following Ordinance:- title mQ ca~m&elltrc(l) This called the_lncome Tax (Amendment) Ordinance, 201 8. Ordinam XLM of 2081.-In Ordinance, 2001 (XLIX of 2001),–

(a) for sub-section (3d,a following shall be substituted, namely:- “(2) Ttie amount lrfemd to in subss*ion ff) shall be included in the person’s income chargeable to tax- wrbhnt representing ni- concealed income is Pakistan-source; and

(b) in the tax year immediately preceding the tax year in expenditure is discpvered by the Commissioner and is incolpe is foreigwource.“; and

(b) in sub-section (4). in clause (a), after word “channels”, the words ’hot exceeding ten million Rupees in a tax year” shall be inserted;

(2) in section 114,- *&;, (a) in sub-section (I), in clause (b),- i.nrb -clause (viii), the word “or” at the eqd , ’,!:.%i . ’., i.. ..

PART 11 THE G A ZOF~ PA KISTAN, EXTRA.,’APRIL 8, U ) I ~ 157

(ii) in sub-clause (ix), for full stop at the end, a semicolon and the word “; or” shall be substituted and thereafter the following new sub-clause shall be added, namely:- every residmt person being an individuat tequind to file “(x) foreign income and assets statement under section 1 16A.”; (“1 m sub-section (2),-

(i) in clause (d), the word “and” at the end shall be omitted; and d

(ii) in clause (eJ, for full stop at the end a semicolon and the word “; and” shall be substituted and thereafter the following new clause shall be added, namely:-

(f) shall be accompanied with a foreign income and assets statcmmt as nquked un& section 116A.“; and

(c) in sub-section (S), in the proviso, for full stop at the end a colon shall be substituted and thereafter the fallowing second proviso shall be added, namely,- “Provided further that the time-limitation provided under this sub-section shalt not appty if the Commissioner is satisfied on the basis of reasons to be recotdeil in writing that a person who failed to furnish his return has fokign income’or owns fmign assets.”;

(3) after section 116, the following new section 116A shall be inserted, namely,- “116A. Foreign income and assets statement.-(l) Every resident taxpayer being an individual having foreign income equal to or in excess of ten thousand United States dollars or having foreigo assets with a value of one hundred thousand United States dollars or more shall furnish a statement, hereinafter referred to as the foreign income and assets statement, in the prescribed fm and verified in the prescribed manner giving particulars of -

(a) the person’s total foreign assets and liabilities as on the last day of the tax year;

(b) any foreign assets transferred by the person to any other person during the tax year and the consideration fw the said transfer; and

(c) complete particulars of foreign income, the expenditure derived during the tax year and the expenditure wholly and necessarily for the purposes of deriving the said income.

(2) The Commissioner may, by a notice in writing, require any person being an individual, who in the opinion of the Commissioner on the basis of reasons to be reconled in writing, w& required to furnish a foreign income and assets statement under sub-section (1) but who has failed to do so, to furnish the foreign income and assets statement on the date specified in the notice.“; -. in section 1 18,- (4)

(ii) after &z figure “1 16” the eyasion “or a foreign inwme and assets statement under 1 16A, if applicable” shall be inserted, after the figure “1 16”, the expression “or a foreign inwine iind assets sdatcment under 116A. if applicablen shall be added;

(5) in s&on 185 in thc Table, in’ columa, (l), after S. No. IAA and entries relating thereto in columos (2M3) and (4), the f~lbwingne w S. No. and entries relating thereto shall be inserted, namely;- “1AAA Where any person fails Such persons shall pay 1 16A”; and default (6)’ in ScWule 1, in PART 1, for Division I, tbe following shall be substituted, namely:- “Division I Rates of Tax for Individuals ,

(1) With effect from 1st day of July 2018, the rates of tax imposed on the taxable income of every individual shall be as set out in the following Table, namely:-

TABLE Rs. 1,200,000 Rs. 1,200,000 3. Where the taxable income exceeds Rs. 60,000 + 10% of the amount exceeding Rs.2,400,000 exceeding Rs.48,000,000 , Rates of Tax for Association of Persons The rates of tax imposed on the taxable income of every association (2) of persons shall be as set out in the following Table, namely:- TABLE

160 THE GAZETTE OF PAKISTAN, EXTRA., APRIL 8, 2018 [PART I 7. not exceed Rs.6,000,000 I Provided that in the case of an association of persons that is a professional firm prohibited from incorporating by any law or the rules of the body regulating their profession, the 35% rate of tax mentioned against S. No. 8 of the T&le shall be 32% for tax year 2016 and onwards.

(3) Where the taxable income in a tax year, other than income on which the deduction of tax is final, does not exceed one million Rupees of a person-

(a) holding a National Database Registration Authority’s Computerized National Identity Card for disabled persons; or

(b) a taxpayer of the age of not less than sixty years on the first day of that tax year, the tax liability on such income shall be reduced by fifty per cent.” MAMNOON HUSSAIN, President. KARAMAT HUSSAM NIAZI, Secretary. PRINTED BY THE MANAGER, PRMTING CORPORATION OF PAKISTAN PRESS, ISLAMABAD. PUBLISHED BY THE DEPUTY CONTROLLER, STATIONERY AND FORMS, UNIVERSITY ROAD, KARACHI.