MAQBOOL HAROON SHAHID SAFDAR & CO. CHARTERED ACCOUNTANTS

SKY IS THE LIMIT June 2018

Registration of MHSS with ACCA as Approved Training Employer

ACCA Approved Training Employers (ATE) are formally recognized partners of ACCA. They provide a working environment that is designed to support ACCA members and/or trainees. MHSS has been registered with ACCA as ATE in Platinum category which will enable it to provide extensive opportunities of training and development to ACCA students/members across the Globe. MHSS will contribute to the future of industry through induction of ACCA staff by providing them suitable platform where they can demonstrate practical experience.

Registration of MHSS with ICAEW as Authorized Training Employer

MHSS has been registered as an authorized training

organization with Institute of Chartered

Accountants of England & Wales in order to

provide quality and prestige training of the ACA

qualification and helping the trainee students to

learn and develop their expertise according to the

current business requirements. Said approval is

normally granted to the organizations who are

offering most advanced learning and professional

development program available.

Registration of MHSS with SECP as an Intermediary to carry out the procedure of registration and annual compliances for companies

After promulgation of Companies Act, 2017, it has been made compulsory that only the person who is duly registered with SECP as an intermediary, could act on behalf of company. In this regard, said intermediary would be able to file any document or form with SECP. In order to comply with this requirement, MHSS has been registered with SECP as an intermediary with effect from June 05, 2018.

Training Session on BE Tech ERP Be Tech is an Enterprise Resource Planning (ERP) tool and complete financial solutions for accounting and business needs. Said ERP has been successfully implemented on our numerous clients. Said ERP consists of Eight Modules. As we are engaged in the retainership, internal audit and external audit services, thus it is dire need of the hour that our staff should be well conversant with operational and technical details of this ERP. In this connection, an introductory training session for senior and semi senior staff was conducted on May 08, 2018 at MHSS office. The training session was conducted by Mr. Shahid Hafeez and following areas were covered:

• Creation of company profile

• Creating initial chart of accounts

• Setting up inventory module according to specific

client requirements

• Creating and integrating point of sale module

Almost 15 staff members attended the session. All of the staff members have actively participated in the questioning session. Sessions on remaining modules would be conducted in the coming months.

Training Session on “SAFASHA RETAIL PRO”

MHSS has recently developed its own ERP software to address the specific needs of its clients in retail, restaurants and other similar business categories. In this connection, first product of our house has been launched with the name of “Retail Pro”. In order to understand its features, training sessions are regularly conducted to increase the expertise of client management personal and MHSS’s own staff members. Accordingly, training session for senior and semi senior staff was conducted on May 10, 2018 at MHSS office by our Manager Software Development Department, Mr. Nasir Bhutta on following areas of the said ERP:

• Setup configuration

• Sales process

• Checkout process

• Sales refund, procurement

• Debit note

• Inventory management

• Customer and vendor management

• Employee/user’s setup

• User profile, reports, day history etc.

• Discount coupons

• Promotion management

Training Session on Stock Take

MHSS has been conducting regular training session for its staff members in order to enhance their knowledge base and to build an understanding of new and improved method of doing stock take. One of such sessions was conducted during last quarter dated 23rd June, 2018 in conference hall of University of Lahore, City campus. Mr. Rashid Rafique, ACA, Manager Audit and Assurance has shed light on the following areas:

• Objectives of stock take

• Stock take procedures

• Stock take approaches

• Stock related balance sheet assertion

• Cash count

• Importance of cut off dates and procedures

• Procedures to count the Raw Material, Work in Process and Finished Goods

• Management reports and documents requirement on stock take

• Auditor’s report on stock take

• Identification of damaged stock and its reporting

New Recruitments In this quarter, MHSS has added the following staff in its team:

1. Talat Mehmood Malik (Assistant Manager Overseas Compliance)

Further, following trainees has been registered with ICAP:

1. Muhammad Sharjeel Shaukat (Overseas Compliance)

Words of Courtesy to our New Clients

We always welcome our new clients and provide quality services to our current clients. List of clients in this quarter who have chosen our organization as their Tax, Corporate and Audit Consultants are listed below:

• ZPEC Pakistan (Private) Limited

• Zhongman Petroleum and Natural Gas Group Corporation Limited

• Tianjin China Petroleum Drilling Company Limited (Pakistan Branch)

• CPI Power Engineering Company Limited

• Hong Kong River and Engineering Company Limited

• Huai Long Construction Company Pakistan (Private) Limited

• East Power Enthusiasm Construction Company (Private) Limited

• CHD Power Plant Operation Pakistan (Private) Limited

• MBELLO UAE

• Komkon Salt UAE

• Al-Khidmat Foundation

Tax Amnesty Scheme 2018 Tax amnesty scheme was announced by Government of Pakistan in April, which was expected to expire by June 30, 2018, however, the filling date has been extended till 31 July 2018. Supreme Court of Pakistan has also approved that amnesty scheme; therefore, people are now moving to avail this opportunity. A large number of citizens of Pakistan has availed this amnesty scheme in its first phase ending June 30, 2018. Extension in date of filing is on the demand of chambers and businessmen community. May it be added here that regulatory authorities have already taken measures to trace foreign assets of

Pakistani citizens by signing the Multilateral Convention on Mutual Administrative Assistance in Tax Matters with OECD (Organization for Economic Co-Operation and Development). Recently, all foreign assets of Pakistani citizens which are not declared through this one-time window opportunity would be traced and would be subject to taxation at higher rates than the rates provided in this amnesty scheme. In respect of above, State Bank of Pakistan has also issued a notification No. FD/170412011/2018 dated April 16, 2018, wherein SBP has clarified the procedure for payment of tax and repatriation of foreign liquid assets. FEDERAL BUDGET 2018-19 In this quarter, Federal budget was presented in National Assembly. The budget was presented on April 27, 2018 and without change in the basic structure of the budget it was approved by the assembly on May 18, 2018. In this budget, Govt. has made very important changes in the taxation laws, which includes taxation of offshore income, change in company, AOP, Individual and super tax rates. Moreover, some technical amendments have also been made for the purchase and sale of immovable property. Furthermore, more strict policy has been adopted for non-filers. For detail please check our booklet with the name of Finance Act, 2018. Federal Budget can also be viewed on our website. https://www.mhssco.com. IMPORTANT JUDGMENT PASSED DURING THE QUARTER Supreme Court Judgment on deduction of unreasonable and high amount of tax/other charges by mobile companies Chief Justice of Pakistan has taken notice of the matter on the view that an unreasonable and high amount of tax/other charges were being deducted from the topping up of the balance through easy load and scratch cards besides taxes on the calls. In this connection, A two-member bench, headed by the Chief Justice Mian Saqib Nisar, issued the ruling dated June 11, 2018, while hearing a Suo Motu notice the withholding tax imposed on mobile recharge at apex court’s Lahore Registry. The apex court gave a two-day deadline to the companies for implementing the order. It was also observed that tax should be collected from those who used the mobile phones beyond the limits. The court also ordered to form a comprehensive plan for deducting taxes on mobile cards, adding that the taxes – withholding tax, Federal excise duty and others will not be deducted until the final verdict in the case is announced.

OTHER IMPORTANT UPDATES Module for Correction of Computerized Payment Receipt (CPR)

Module for Correction of Computerized Payment Receipt (CPR) for sales tax and income tax has been launched by FBR which will allow correction of following particulars through a standardized manner:

a) Change in NTN/ Name of Taxpayer b) Change in tax period

Online Payment of Taxes

FBR has initiated the payment procedure through Direct Debit (ATM and Online banking) from the respective bank account of tax payer. For this purpose, the tax payer is required for apply change in his profile on http://e.fbr.gov.pk.

To help taxpayer understand this method, a complete procedural guide was issued by FBR. The said initiative is live on trial basis. In this regard, SBP has also officially launched ‘Online Collection of Taxes and Duties’ on March 20, 2018 to enable taxpayers to pay the FBR taxes and duties online using their internet banking accounts or ATMs. Moreover, the banks have been advised to take the necessary steps like sending periodic messages to the account holders and placing FBR’s advertisement on their websites, to create awareness about the facility.

One Window Facility for Company Formation and NTN Registration

The Securities and Exchange Commission of Pakistan (SECP) and the Federal Board of Revenue (FBR) have launched a one-window facility for company registration and national tax number (NTN) registration. Through this facility, the entrepreneur can login to the SECP online portal e-services and get the company registered with the

SECP; they will then receive the NTN automatically at the company’s email address.

The facility has been launched to simplify the procedures for business registration and to ensure an expeditious service delivery by integrating the registration procedures of FBR and SECP.

Fluctuation in Dollar Rate

Political uncertainties in Pakistan and Government’s commitments towards foreign financial bodies has led to an escalation in the value of US Dollar in inter banking trading. The State Bank of Pakistan (SBP) held rising demand for dollars responsible for the rise in the USD.

However, declining exports and diminished foreign investment could be the main causes. Drop in value of Pak Rupee would pave way for inflation and lesser foreign investment in the country. Devaluation of Pak Rupee would lead to increase in prices of day to day consumer goods, petrol prices and other related services.

Changing Political Trends and Elections

General Elections are scheduled to be held in Pakistan on 25th July 2018. Currently, political situation is unpredictable and no one knows which party will grab most of the national assembly and provincial assembly seats in elections 2018.

As Pakistan’s current account deficit increased by 50.6% from the past year, so the International Monetary Fund (IMF) and the World Bank have warned that the current account deficit could impede Pakistan’s economic growth in future. Increased size of imports, declining Dollar reserves and increased interest rate would lead next Government to face a balance of payment crises. TECHNICAL UPDATES SECP Proposed Draft Companies (General Provisions and Forms) Regulations, 2018

SECP through SRO 758(1)/2018, dated June 11, 2018, has issued notification of draft companies (General Provisions and Forms) Regulations, 2018. The said draft for Companies General Provisions and Forms Regulations 2018 once promulgated shall repeal the old Companies General Provisions and Forms Rules 1985 and Single Member Companies Rules 2003. It includes some new forms as well.

Amendment in Employees Contributory Funds (Investment in Listed Securities) Regulations, 2018

SECP through its SRO 731(i)/2018 has amended Employees Contributory Funds (Investment in Listed Securities) Regulations, 2018 which were previously published vide S.R.O 435(I)/2018 dated

9th April 2018. These regulations apply to all provident funds or other contributory retirement funds established by company or by a trust, created by a company to manage funds in respect of all the investments made by the company. However, these regulations do not apply to a pension fund governed under Voluntary Pension Scheme Rules, 2005. These regulations describe “limits for investment in listed securities” and “conditions for investment in limited securities”. These regulations require that all the investments which are beyond the limits provided in these regulations should be reduced gradually within a period of one year from the date of commencement of these regulations and should be brought in conformity with the provisions of these regulations.

Amendments in the Table F under the First Schedule of the Companies Act, 2017 SECP through its SRO 732 (I)/2018 has amended expressions from “2016”, to “2017” under heading and has amended Memorandum of Association and Articles of Association’s Section in Table F. Amendments in SRO 450(I)/2017 SECP through its SRO 733 (I)/2018 (Previously S.R.O 450 (I)/2017) has amended associations with Charitable and Not for Profit Objects Regulations, 2018 which are applicable to companies licensed under Section 42 of the Company Act and all the companies licensed under Section 42 shall comply with all the requirements of these regulations.

However, these regulations do not apply to trade organizations licensed under the Trade Organizations Act, 2013. Application for renewal of license under these regulations will be provided to SECP on NFP

form as available on SECP website and SECP will grant renewal of license for a period of three (3) years.

Limited Liability Partnership (LLP) Regulations, 2018 SECP has issued limited liability partnership regulations 2018 on 10th May, 2018 vide its S.R.O 601(I)/2018 (previously S.R.O 407(I)/2018). The same has been previously published vide SRO 407(I)/2018 dated 26th March 2018. It describes procedures for registration and conversion of firms and companies into LLP.

SECP amended “The Companies (Distribution of Dividend) Regulations, 2017”. The SECP has amended “The Companies (Distribution of Dividend) Regulations, 2017” up to April 18, 2018, Vide S.R.O 1145(I)/2018.

These regulations describe period and manner of payment of cash dividend. However, the requirements of these regulations will not be applicable on all those companies that have announced cash dividend before the commencement of these regulations.

SECP has issued “Manner and Selection of Independent Directors Regulations” SECP through its S.R.O 556(I)/2018 has issued “Manner and Selection of Independent Directors Regulations” on 26th April 2018. These regulations describe criteria for maintaining data bank with reference to section 166 of Companies Act 2017 and eligibility criteria for persons and procedures and manners for including names of persons in data bank. These regulations apply to any institute, body or association notified by the Commission for

maintaining and creating databank of independent directors and to the companies or entities required to select independent directors under any Law, Rules, Regulations or Code. SECP notifies Auditors (Reporting Obligations) Regulations, 2018 SECP through its S.R.O 558(I)/2018 has issued Auditors (Reporting Obligations) Regulations, 2018 on 26th April 2018. The same has been published vide S.R.O 471(I)/2017 dated 15 June 2017. These regulations describe Reporting requirements and annexures have been given for Auditor’s report on financial statements, consolidated financial statements, interim financial statements and on the compliance with corporate governance regulations.

Withdrawal of General Order in respect of Companies (Compliance with Licensing Conditions)

SECP through its S.R.O 559(I)/2018 has withdrawn its Companies (Compliance with Licensing Conditions) General Order of November 2016 on 30th April 2018.

SECP issued notification of International Financial Reporting Standard (IFRS) 16. SECP has directed through S.R.O 434(I)/2018 dated 9th April 2018 that IFRS 16 (Leases) and any changes made therein should be followed instead of IAS 17

for the preparation of financial statements by all the classes of companies that are required by the Act to follow IFRS. IFRS 16 will be applicable effectively from January 01, 2019.

Prohibition of Dealing in Virtual Currencies/Tokens

State Bank of Pakistan through its BPRD Circular No. 03 of 2018, issued on 6th April 2018 has strictly prohibited dealing in virtual currencies like Bitcoin, Litecoin, Pak coin, One Coin, Das Coin, Pay Diamond etc. or Initial Coin Offerings (ICO) tokens.

SBP has stated that these currencies are not legal tender, issued or guaranteed by the Government of Pakistan. Moreover, SBP has not authorized or licensed any individual or entity for the issuance, sale, purchase, exchange or investment in any such currencies. SECP Amended “Companies (Incorporations) Regulations, 2017”

SECP has amended Companies (Incorporations) Regulations, 2017 that were previously issued through S.R.O 274(I)/2018 through S.R.O 483(I)/2018 on 17th April 2018. Numerous changes have been made in regulations regarding Regulation 2-9 and in 11, 12, 14-16. Form I and Form II should be included in Annexure-I, II, III, IV, V, VI and VII. Pakistan Engineering Council (PEC) directs firms to get Financial Statements Audited by a QCR rated Audit Firms. PEC has directed all the firms and companies to furnish financial statements duly audited by a QCR (Quality Control Review) rated Audit Firms. PEC also directed all de-registered constructors/operators to get their firm renewed/registered by making an

application for reinstatement, under amnesty scheme valid till 30th June 2018. PEC also directed ‘constructors/operators firms’ applying for renewal to provide evidence of payment made to engineers employed by them during last validity period of license. Online Registration System for Constructors/Operators PEC has launched an online registration system for constructors/operators and online applications would be entertained against category C1, C2, CA, CB, O1, O2, OA and OB. However, in cases where PEC has made it mandatory for constructors/operators to submit original license, in such cases person applying for registration would have to submit original license manually at PEC office.

Following additional facilities would only be available for O2/C2 and above category firms

✓ New Registration ✓ Renewal of Registration ✓ Provision of Additional Code ✓ Up gradation/ De gradation ✓ Change of Address; and ✓ Change of Ownership/ Partnership

CHECKLIST FOR TAXPAYERS W.E.F. 1ST JULY, 2018

• Individual tax rate slabs have been revised in line with

tax reforms package. Accordingly, employers would be

required to withhold Income tax from salaries as per

rates applicable to Individuals. (Rates are provided

on the next page)

• Corporate tax rates for companies other than banking

companies would be 29% for tax year 2019.

• Tax rates for AOP have also been revised, so applicable

rates would be as per rates provided in the Tax Card.

(Rates are provided on the next page)

• Super tax rate would be 3% for the tax year 2019.

• Late filer of income tax return would not be included in the Active Taxpayers’ List for 2019 and shall

not be allowed to carry forward any tax losses for that tax year.

• Service of notice through electronic means to be considered as valid notice, thus now it would be

required to regularly check the inbox of IRIS.

• A company, being member of an association of persons, is now able to claim credit of tax deducted in

the name of association of persons in the same proportion as the share of the company in the profits

of such association of persons.

• Offshore supplies made by person from outside Pakistan would be taxable income in Pakistan and

would be subject to withholding of Income Tax as per Section 152 of Income Tax Ordinance, 2002.

However, if it is established through tax treaty that it is exempt then the person making payment would

be required to file a notice of payment without deduction of tax before its concerned Commissioner

Inland Revenue and said Commissioner will issue order on such application within 30 days of such

filing of notice.

• Directorate General of immoveable property will be appointed to detect the avoidance or reduction of

withholding tax obligations, cconcealment of unexplained amount or avoidance or reduction of capital

gains tax on account of transfer of Immovable Property at lower than the Fair Market Value. If

aforesaid intention is established then FBR shall have the right to purchase any property within six

months of registration of transfer at value over and above the declared value which would be 100%.

• Resident persons will be required to provide explanation about the nature and source of remittances

in excess of Rs. 10 million in a tax year under Section 111 of Income Tax Ordinance, 2001.

• Withholding tax limits are enhanced in respect of sale of goods from Rs. 25,000 to Rs. 75,000 and for

services rendered from Rs. 10,000 to Rs. 30,000 per annum.

• Tax on commercial importers charged at the time of import would be minimum tax, so it is essential

to make all payments through crossed cheque, withhold taxes and comply with other provisions of

section 21 of the Ordinance.

• Non-filers will not be eligible for the registration of new vehicles and immovable property valuing in

excess of Rs. 5 million.

• Gain arising to a non-resident company from disposal or alienation outside Pakistan of an asset located

in Pakistan will be treated as Pakistan source income and chargeable to tax at 15%.

• Resident individual taxpayers are required to file foreign income and asset statement in case where

foreign income equal to or exceeds USD 10,000 or foreign assets of value USD 100,000 or more

otherwise penalty of 2% of value of such income or assets will be applicable.

*

• Tax deducted on payment against services to permanent establishment of non-residents under section

152 (2A) (b) would be treated as minimum tax.

• Disposal of assets in form of gift could only be made to the relatives (ancestor/ descendant of any of

the grandparents, adopted child, spouse including spouse of associate) only.

Sales Tax

• Further Sales tax would be charged at the rate of 3%

from un-registered persons.

• Withholding of sales tax from unregistered persons

would be 1% and no withholding from registered

persons on supply of goods under Sales Tax Act, 1990.

• 100% sales tax would be deducted by withholding agent

from un-registered persons and registered non-

corporate persons under Punjab Sales Tax on Services

Act, 2012.

• 100% sales tax would be deducted from un-registered persons and 20% of the sales tax would be

deducted from registered persons under all other provincial laws [Sindh Revenue Board, KPK Revenue

Authority, Baluchistan Revenue Authority].

TAX CARD FOR THE TAX YEAR 2018-19

TAX RATES FOR INDIVIDUAL (Division I, Part 1 of the First Schedule)

1 Upto Rs.400,000 0%

2 Rs. 400,001 to Rs. 800,000 Rs. 1,000

3 Rs. 800,001 to Rs. 1,200,000 Rs. 2,000

4 Rs. 1,200,001 to Rs. 2,400,000 5% of the amount exceeding Rs 1,200,000

5 Rs. 2,400,001 to Rs. 4,800,000 Rs. 60,000 + 10% of the amount exceeding Rs 2,400,000

6 Exceeding Rs. 4,800,000 Rs. 300,000 + 15% of the amount exceeding Rs 4,800,000

TAX RATES FOR AOP

(Division I, Part 1 of the First Schedule)

1 Upto Rs. 400,000 0%

2 Rs. 400,001 to Rs. 1,200,000 5% of the amount exceeding Rs 400,000

3 Rs. 1,200,001 to Rs. 2,400,000 Rs. 40,000 + 10% of the amount exceeding Rs 1,200,000

4 Rs. 2,400,001 to Rs. 3,600,000 Rs. 160,000 + 15% of the amount exceeding Rs 2,400,000

5 Rs. 3,600,001 to Rs. 4,800,000 Rs. 340,000 + 20% of the amount exceeding Rs 3,600,000

6 Rs. 4,800,001 to Rs. 6,000,000 Rs. 580,000 + 25% of the amount exceeding Rs 4,800,000

7 Exceeding Rs. 6,000,000 Rs. 880,000 + 30% of the amount exceeding Rs 6,000,000

*

TAX RATES FOR COMPANIES

(Division II, Part 1 of the First Schedule)

TYPE TAX RATE (2018) TAX RATE (2019)

Banking Company 35% 35%

Public and Private Company 30% 29%

Small Company 25% 25%

SUPER TAX FOR COMPANIES

(Division IIA, Part 1 of the First Schedule) TAX RATE (2018) TAX RATE (2019)

Banking Company 4% 3%

Person other than banking company have income equal to 500 million or more

3% 2%

CAPITAL GAIN ON DISPOSAL OF IMMOVABLE PROPERTY

(Division VIII, Part 1 of the First Schedule) 2019

Irrespective of holding period allotment covered U/S 236C (4) 0.00% 0.00%

Holding period upto [01] Year acquired on or after (01-07-2016) 10.00% 10.00%

Holding period upto [02] Year acquired on or after (01-07-2016) 7.50% 7.50%

Holding period upto [03] Year acquired on or after (01-07-2016) 5.00% 5.00%

Holding period is more than [03] Year acquired on or after (01-07-2016) 0.00% 0.00%

Holding period is upto [03] Year acquired before (01-07-2016) 5.00% 5.00%

Holding period is more than [03] Year acquired before (01-07-2016) 0.00% 0.00%

FOREIGN INCOME AND ASSET STATEMENT U/S 116A

Filing of foreign income and asset statement along with return of income is compulsory for individual who earns 10,000$ or is the owner of foreign assets having a value of 100,000$ or more.

MINIMUM TAX

Description 2018 2019

Nature of Payment Section Filer Non-Filer Filer Non-Filer

Individual & AOP [having annual turnover Rs.10 Million or more] and Companies

113 1.25% of Turnover 1.25% of Turnover

Oil Marketing Companies, Refineries, SSGCL, SNGPL, PIA, Poultry Industry and Dealer or Distributor of Fertilizer

113 0.5% of Turnover 0.5% of Turnover

Distributors of Pharma, Fast Moving Consumer Goods, Cigarettes, Petroleum Agent, Rice Mills/Dealers and Flour Mills

113 0.2% of Turnover 0.2% of Turnover

Motorcycles Dealers 113 0.25% of Turnover 0.25% of Turnover

Imports of edible oil and packing material (Companies & Industrial Undertaking)

148(8) 5.50% 8.00% 5.50% 8.00%

Imports of edible oil and packing material (Other than Above)

148(8) 6.00% 9.00% 6.00% 9.00%

Services (Companies) 153(1)(b) 8.00% 14.50% 8.00% 14.50%

Services (Other Than Above) 153(1)(b) 10.00% 17.50% 10.00% 17.50%

Transport Services 153(1)(b) 2.00% 2.00% 2.00% 2.00%

Electronic & Print Media Advertising Services (Companies)

153(1)(b) 1.50% 12.00% 1.50% 12.00%

Electronic & Print Media Advertising Services (Others)

153(1)(b) 1.50% 15.00% 1.50% 15.00%

Services to Textile, Carpets, Leather, Surgical & Sport Goods

153(1)(b) 1.00% 1.00% 1.00% 1.00%

FINAL DISCHARGE OF TAX

Nature of Payment 2018 2019

Section Filer Non-Filer Filer Non-Filer

Imports of multiple Steel, Potassic Fertilizer, Urea, Gold, Cotton, LNG & Manufacturers under SRO.1125(1)2011

148 1.00% 1.50% 1.00% 1.50%

Imports of Pulses 148 2.00% 3.00% 2.00% 3.00%

Imports Commercial covered under SRO.1125(1)2011

148 3.00% 4.50% 3.00% 4.50%

Imports of Ships by Ship Breakers 148 4.50% 6.50% 4.50% 6.50%

Import (Companies & Industrial Undertaking) 148 5.50% 8.00% 5.50% 8.00%

Import (Other Than Above) 148 6.00% 9.00% 6.00% 9.00%

Dividend 150 7.50% to

25% 7.50% to

25% 7.50% to

25% 7.50% to

25%

Profit on Debt upto Rs. 500,000 (Other than companies)

151 10.00% 10.00% 10.00% 10.00%

Profit on Debt Exceeding Rs. 500,000 (Other than companies)

151 10.00% 17.50% 10.00% 17.50%

Royalty or Fee for Technical Services by Non-Residents

152(1) 15.00% 15.00% 15.00% 15.00%

Contract by Non-Resident 152(1)(A) 7.00% 12.00% 7.00% 12.00%

Sale of goods (Companies) 153(1)(a) 4.00% 7.00% 4.00% 8.00%

Sale of goods (Other Than Companies) 153(1)(a) 4.50% 7.75% 4.50% 9.00%

Sale of Rice, Cotton seed and edible oil 153(1)(a) 1.50% 1.50% 1.50% 1.50%

Sale by Distributor of fast moving consumer goods (Companies)

153(1)(a) 2.00% 2.00% 2.00% 2.00%

Sale by Distributor of fast moving consumer goods (Other)

153(1)(a) 2.50% 2.50% 2.50% 2.50%

Local Supply to Textile, Carpets, Leather, Surgical and Sports Goods Sectors, Cigarettes and Pharmaceutical Products

153(1)(a) 1.00% 1.00% 1.00% 1.00%

Contracts (Companies) 153(1)(c) 7.00% 12.00% 7.00% 14.00%

Contracts (Other than Companies) 153(1)(c) 7.50% 12.50% 7.50% 15.00%

Contracts (Sports Persons) 153(1)(c) 10.00% 10.00% 10.00% 10.00%

Services of Stiching, Dying, Printing, Embroidery, Washing, Sizing and Weaving to Exporters

153(2) 1.00% 1.00% 1.00% 1.00%

Exports 154 1.00% 1.00% 1.00% 1.00%

Indenting Commission 154(2) 5.00% 5.00% 5.00% 5.00%

Prize & Winnings 156 15% to 20% 25.00% 15% to 20% 25.00%

Commission on petroleum products 156A 12.00% 17.50% 12.00% 17.50%

Advertising agents 233 (1) 10.00% 15.00% 10.00% 15.00%

Advertising Commissions 233 (1) 8.00% 16.00% 8.00% 16.00%

Brokerage and Commission (Other Than Above)

233 (1) 12.00% 15.00% 12.00% 15.00%

CNG Stations on Gas Bills 234A 4.00% 6.00% 4.00% 6.00%

Advance Tax on Bonus shares issued by Listed Companies

236M 5.00% 5.00% 0.00% 0.00%

Advance Tax on Bonus shares issued by Non-listed Companies

236N 5.00% 5.00% 0.00% 0.00%

ADJUSTABLE TAX

Advance Tax on functions and gatherings (for major cities)

236D 5.00% 5.00% Higher of

5% or 20,000 Higher of 5%

or 20,000

Advance Tax on functions and gatherings (for other cities)

236D 5.00% 5.00% Higher of

5% or 10,000 Higher of 5%

or 10,000

Sale of goods (Listed and manufacturer Companies)

153(1)(a) 4.00% 7.00% 4.00% 8.00%

Advance Tax on Transactions by Non-filers 236P NA 0.40% NA 0.40%

PAYMENT/DEDUCTION ON INCOME FROM PROPERTY U/S 15 & 155 FOR IND. & AOP

(Division VIA, Part 1 of the First Schedule) & (Division V, Part III of the First Schedule)

2018 2019

Upto Rs. 200,000 NIL NIL

Rs.200,000 to Rs.600,000 5% of gross amount exceeding Rs. 200,000 5% of gross amount exceeding Rs. 200,000

Rs.600,000 to Rs.1,000,000 Rs. 20,000 + 10% of gross amount exceeding Rs. 600,000

Rs. 20,000 + 10% of gross amount exceeding Rs. 600,000

Rs.1,000,000 to Rs.2,000,000 Rs. 60,000 + 15% of gross amount exceeding Rs. 1,000,000

Rs. 60,000 + 15% of gross amount exceeding Rs. 1,000,000

Exceeding Rs. 2,000,000 Rs. 210,000 + 20% of gross amount exceeding Rs. 2,000,000

Rs. 210,000 + 20% of gross amount exceeding Rs. 2,000,000

DEDUCTION ON INCOME FROM PROPERTY U/S 155 FOR COMPANIES

(Division V, Part III of the First Schedule)

The rate of tax to be deducted under section 155, in case of company shall be 15% for filer and 17.5% for non-filer of gross amount of Rent.