S. Tax 20

Question 1

Exceptions to Further Tax

Answer 1

3% further tax shall not form output tax and added as botton line figure

However 3% shall not be applicable:

(a) in case of supply including by retailers to end consumer
(b) Supply of third schedule items
(c) Electricity and natural gas supplied to domestic/agriculture consumers
(d) Fertilizers
(e) Supply by steel melters, re-rollers and ship breakers under special procedure
(f) Zero rated supplies covered under fifth schedule
(d) Second hand and worn clothing
e) White Crystalline sugar
f) Foam / Spring mattress

Question 2

Is there Further Tax Applied on 5th Schedule Items and to Cottage Industry

Answer 2

5the Schedule - No

Cottage Industry - Yes

Question 3

Exceptions to 90% restriction
-Persons

• Supplies
• Purchases
• Industry

Answer 3

Persons
-Distributor

Supplies

• Zero rate supplier - whole entity (zero rate:local ration 50.01:49.9) i.e. no 90% restriction for local supply even
• Zero rate supplier - Zero rate only (zero rate:local ration 49.9:50.01) i.e. 90% restriction for local supply

Purchases

• Comm. Imp. - whole entity (zero rate:local ration 50.01:49.9) i.e. no 90% restriction for local supply even
• Comm. Imp. - Zero rate only (zero rate:local ration 49.9:50.01) i.e. 90% restriction for local supply
• Fixed Assets, Capital goods

Industry (Elect, gasoil marketing, refineries, fertilizer, edible oil, telecom)

Question 4

90% Restriction Extension?

Answer 4

95%

SRO 1190

• Tier - 1 Retailer
• Yarn W/Saler
• Listed Auto retailers

Question 5

4 Exceptions to Sec 73 (Banking Channel)

Answer 5

Sec 73 not applicable on

• registered person supplying goods to unregistered person. However supplier should deposit cash in his business bank account to claim input tax.
• Also not applicable on goods received in kind payment provided they are taxable goods and any balance payment even if it is less than Rs.50,000 is made through banking channel.
• Payment < 50000
• Utilities

Question 6

Exceptions to WHT

Answer 6

11th Schedule:

• Active Tax Payer, So only from Non-Active Tax Payer & Unregistered
• 3rd Schedule
• Importer who paid VAT
• Supplies (Cooking oil, ghee, telecom, petroleum, gas, electricity, etc)

Question 7

WHT Rates?

Non-Active Registered
Unregistered

Answer 7

• NAR - 20% Manuf;10% others; adv. services 100%

- Unreg - Payer Govt - Full 17/117; Payer Others 5% of valaue of goos 5/117

Question 8

Exceptions from payment of 3% VAT on import

Answer 8

Value addition tax not payable by:
(a) raw material and intermediary goods meant for use in an industrial process which are subject to customs duty at rate less than 16%.
Note: 3% value addition tax shall not be charged on import of raw material unless question expressly states that rate of custom duty was greater than or equal to 16%.
(b) Petroleum Products by oil marketing companies for sale in Pakistan.
(c) Registered service providers importing goods for own use
(d) RLNG/LNG
(e) Second hand and worn clothing or footwear
(f) Gold and silver in unworked condition
(g) Cellular mobile phone or satellite phones
(h) Goods specified in 3rd schedule on which input tax is paid on retail price basis.

Question 9

ST Q

-Input 4 points to be checked

Answer 9

-Input Q - ST /applicable/applied by seller; Rate; input allowed; withholding?

Question 10

What if missed applying sales tax on supply and commissioner accepted that this was not intentional

Answer 10

Pay sales tax by applying tax fraction formula

Value*17/117 (law assumes value recovered included sales tax)