ISLAMABAD: Important amendments have been made to the Income Tax Ordinance 2001 through the Finance Bill 2024-25.
The government has included 31 amendments in the Income Tax Ordinance 2001 in the Finance Bill 2024-25, which will come into effect from July 1, 2024 after approval from parliament this week. New provisions have been added in Section 57 to provide tax relief to the Pakistan International Airlines Corporation (PIAC), under which the loss incurred in the tax year beginning after 2017 could be carried forward for the next 10 years.
Through an amendment, the conditions of tax exemption have also been tightened. After an amendment to Section 92 of the Income Tax Ordinance, members of the association with a turnover of Rs300 million or more will now get tax exemption only if the association submits company records and income tax report, which should be audited by a chartered accountant or Cost and Management Accountant firm.
After an amendment to Section 100 BA of the Income Tax Ordinance through the finance bill, action could also be taken against persons included in the list of active taxpayers, who do not submit their tax returns within the due date.
New provisions have been added in Section 108 regarding the restriction on expenditure of companies in the form of royalty, under which no tax deduction will be given to any company from 2024 for payments made to an associate company for brand, logo, patents, etc., if more than 25 per cent of the royalties are spent on marketing. After an amendment to Section 147 of Income Tax, the method of assessment of payment of advance tax has been changed and the Income Tax commissioner has been empowered to reject the same or reduce the rate of tax deduction.
After an amendment to Section 153 of the Income Tax Ordinance, the commissioner of Inland Revenue had been given the power to allow a company to deduct tax at a lower rate under certain conditions.
