Draft SRO Pertaining to Decommissioning Certificate

Government of Pakistan (Revenue Division) Federal Board of Revenue ***** Islamabad, the February 28th, 2011 NOTIFICATION (Income Tax) S.R.O. 164(I)/2011.- The following draft of certain further amendments in the Income Tax Rules, 2002, which the Federal Board of Revenue proposes to make in exercise of the powers conferred by section 237 of the Income Tax Ordinance, 2001 (XLIX of 2001), is hereby published for the information of all persons likely to be affected thereby, as required by sub-section(3) of the said section, and notice is hereby given that the draft will be taken into consideration after fifteen days of its publication in the official Gazette. Any objection or suggestion which may be received from any person, in respect of the said draft before the expiry of the aforesaid period, shall be considered by the Federal Board of Revenue. DRAFT AMENDMENTS In the aforesaid Rules, after rule 12, the following new rule shall be inserted, namely:- “12A. Decommissioning certificate.- As required under sub-rule (4A) of rule 2 of Part-I of Fifth Schedule to the Income Tax Ordinance, 2001, decommissioning certificate shall be submitted on the form prescribed as under, namely:-

DECOMMISSIONING CERTIFICATE (As required under sub-rule (4A) of Rule 2 of Part-I of Fifth Schedule to the Income Tax Ordinance, 2001) It is certified that the decommissioning cost claimed, presents fairly, in all material respects: i. I/We have examined the accounts and records of ____________________________ (name, address & NTN of the taxpayer) relating to the decommissioning cost for the tax year ______________. ii. The amortization charge of Decommissioning cost for current year, claimed by the Company in its return of total income for Tax Year ____________ is in accordance with sub-Rule (4A) of Rule 2 of Part I of the Fifth Schedule to the Income Tax Ordinance, 2001. iii. I/We certify that the tax payer has not included amounts of exchange loss, unwinding of discount, mark up or interest, cost of funds or inflationary impact in computing the decommissioning cost. iv. I/We also certify that the denomination of all amounts is in Pakistan rupees (PKR). v. The particulars required to be furnished under sub-Rule (4A) of Rule 2 of Part I of the Fifth Schedule to the Income Tax Ordinance, 2001 are given in the Annexure to this certificate. The information provided in the Annexures is true and correct. Signed: _________________ Name: _________________ Address: _________________ Place: _________________ Date: _________________

ANNEXURE A (GENERAL INFORMATION) Particulars 1. Name of the taxpayer: 2. Address: 3. Tax Year: General 4. No. of concessions owned at the opening date of financial year 5. Names of concessions owned at the opening date of financial year 6. No. of concessions owned at the closing date of financial year 7. Names of concessions owned at the closing date of financial year 8. Amount of decommissioning cost to be amortized under sub-rule (4A) (separately in respect of each concession) 9. No. of years of useful life (separately in respect of each concession) 10. Amount of amortization deduction claimed in the return Additions & Deletions 11. No. of concessions disposed off during the year 12. Names of concessions disposed off during the year 13. Gross consideration received 14. Name of the each purchaser 15. Address 16. No. of concessions acquired during the year 17. Names of concessions acquired during the year 18. Gross consideration paid 19. Name of the recipient 20. Address 21. Amount of decommissioning cost deleted 22. Amount of decommissioning cost added 23. Net amount of decommissioning claim Signed: _________________ Name: _________________ Address: _________________ Place: _________________ Date: _________________

ANNEXURE B (INFORMATION ABOUT THE CONCESSION) 1. Name of the concession 2. Address 3. Name of the Operator 4. Address of the Operator 5. Date of commencement of commercial production 6. Amount of amortization deduction claimed in the return in respect of the concession 7. Total no. of years of useful life 8. Balance no. of years of useful life available 9. Total amount of decommissioning cost Signed: _________________ Name: _________________ Address: _________________ Place: _________________ Date: _________________

ANNEXURE C (HISTORICAL DATA OF THE CONCESSION) Original Year 1 Year 2 Year 3 Year 4* provision at the commencement of commercial production Opening Balance Decommissioning of: cost Financial charges Exchange Loss Unwinding of discount Mark up or inflationary charges Closing Balance of: Decommissioning cost Financial charges Exchange Loss Unwinding of discount Mark up or inflationary charges Additions during Decommissioning the year cost Financial charges Exchange Loss Unwinding of discount Mark up or inflationary charges Deletions during Decommissioning the year cost Financial charges Exchange Loss Unwinding of discount Mark up or inflationary charges *Use extra columns for additional number of years. Signed: _________________ Name: _________________ Address: _________________ Place: _________________ Date: _________________ ”. __________________________________________________________________ [C.No.4 (44)/ITP/2010] (Khawar Khurshid Butt) Member (Inland Revenue)