Basic Concept Of Income Tax Flashcards
What is normal tax year?
The tax years shall be a period of 12 month ending on 30 June and shall be denoted by the calendar year in which 30th June falls
What is special tax year?
Where a person is allowed to used a 12 month period different from normal tax year such period shall be that person’s tax year and shall be denoted by the calendar year relevant to normal tax year in which closing date of special tax year falls.
What is transitional tax year?
Where a tax year of a person changes the period between
_the end of last tax year prior to change and
The date on which changed tax year commences
Shall be treated as separate tax year to be known as trasitional tax year
Who is resident person?
A person shall be resident person for a tax year if the person is
✓a resident individual resident company or a resident aop for the year
✓the federal Govt
Who is non resident person?
A person shall be a non resident person for atax year if the person is not a resident for that year
What is resident individual?
An individual shall be resident individual if he Is
present in Pakistan for a period of or period amounting in aggregate to 183 days or more
Is an employee or official of federal Govt or provincial govt posted abroad in the tax year
What is small company?
Small company means company registered on or after 1st day of July ,2005under the companies act 2017which -
• has paid up capital plus undistracted reserves not exceeding 50 million rupees
•has employees not exceeding 250 at any time during the year
•has annual turnover not exceeding 250 million rupees
• is not a small and medium enterprises
•is not formed by splitting up or reconstitution of business already in existence;
What is Aop?
Aop include following •A firm •A Hindu undivided family •any artificial judicial person •Any body of persons formed under a foreign law . however a company is not included in aop.
What is resident company?
A company shall be president company for atax year if
• it is incorporated or formed by or under any law enforce in Pakistan
•the control and management of the affairs of company is situated wholly in Pakistan at any time in the year.
• it is federal Govt or local Govt in Pakistan.
Rule for resident individual?
A public holiday
A day of leave including sick leave
A day that the individual activity in Pakistan is intrupted because of strike ,lock out or delay in receipt of supplies
Resident Aop?
An aop shall be resident Aop for a tax year if
Control and management of the affairs of Aop is situated wholly or partly in Pakistan at any time in the year.
What is trust?
Trust means an obligation attached to ownership of the property and arising out of the confidence given to and accepted by the owner for the benefit of another and of another and the owners and include a unit trust.
What is meant by currency conversion?
Every amount taken into account under this ordinance shall be in rupees.
Where an amount is in currency other than rupees conversion shall at the State Bank of pakistan rate prevailing at the date at which amount is taken into account.
What is cessation of source of income?
If a taxable source of income ceases to exist either
•before the commencement of the year
•during the tax year
then any subsequent benefit derived from it shall be charge able in normal way assuming source has not ceases at the time income was derived.
What is tax on dividend?
Sec5
