Tax definition:

Tax is a compulsory contribution to state revenue, imposed by the government on workers'

income and business profits, or added to the cost of some goods, services, and transactions.

Purpose:

A tax is a compulsory financial charge or some other type of levy imposed on a taxpayer by a
governmental organization in order to fund government spending and various public
expenditures.

Government expenditures: loan, earning, salaries (public benefit)

Sources of Government Expenditures:

Government spending is financed primarily through these sources: 

Tax collections by the government

 Direct taxes

 Indirect taxes

Direct Tax

Direct taxes are one type of taxes an individual pays that are paid straight or directly to the
government, such as income tax, poll tax, land tax, and personal property tax. Such direct taxes
are computed based on the ability of the taxpayer to pay, which means that the higher their
capability of paying is, the higher their taxes are.

Indirect Tax
An indirect tax is collected by one entity in the supply chain (usually a producer or retailer) and
paid to the government, but it is passed on to the consumer as part of the purchase price of a
good or service. The consumer is ultimately paying the tax by paying more for the product.

Tax Return

A tax return is a form or forms filed with a tax authority that reports income, expenses, and
other pertinent tax information. Tax returns allow taxpayers to calculate their tax liability,
schedule tax payments, or request refunds for the overpayment of taxes.

 Income-expenses=Asset
 Tax is on annual income.
 (1st July-30th June) charge tax every Fiscal year (Normal Tax year)
 Other than (1st July -30th June) Special Tax year
 Transitional tax year
A transitional tax year is a gap between the end of last year before change and the start
of the change tax year.
A transitional tax year come out when any person changes its tax year from normal to
special or from special to normal.
The period lying between the normal tax year and special tax year or vice versa is
termed as transitional tax year. A transitional tax year is treated as a separate tax year .
Income Tax
Filer:
A person who owns “Taxpayers Card” also with his name appearing on the “Active Tax
Payer” list issued by the Federal Board of Revenue is known as “Filer“.
Non-Filer
A person who is not registered with (FBR) as an active taxpayer and does not files
income tax returns annually is known as “Non-Filer”.
Resident
Under the Income Tax Ordinance 2001, a person will be treated as a resident Pakistani,
if he stays in Pakistan for 120 days or more in a tax year.
Resident

Under the Income Tax Ordinance 2001, a person will be treated as a resident

Pakistani, if he stays in Pakistan for 120 days (check record of last 4 years) or more in
a tax year.
A person is resident in Pakistan for income tax purposes: in cases where the individual
is present in Pakistan for a period or periods aggregating to 183 days or more in a tax
year (1 July through 30 June) irrespective of their nationality.
Non-Resident
A person who stays in Pakistan less than 183 days is non-resident of Pakistan.

Count Days:
 Date/Day of arrival
 Date/Day of departure
 Public Holidays
Not count:
 Connecting Flight Duration