Business taxation means those who earn from any source of income or activities then they will give

specific amount to the government in the form of tax. Some rules and regulation will apply for this
purpose. In Pakistan tax collection rate is about 11% that is very low then other countries. Filer
receive more benefit than non filer in the form because filer give less text then non-filer during any
bank transaction. Filer are those who file income tax return and non-final are those who can not file
income tax return. FBR collect tax in Pakistan while CBR collect tax in AJK. Tax collection in a AJK is
90% same as in Pakistan. people earn money in 5 different ways like salary, property, businesses,
capital gain, and.

In ordinance 2001, Section 12, Every person that earn through salary must pay tax within tax year.
According to this section, for any cash, for Capital asset, monthly salary, hourly salary, overwork
salary, money for completion of task, money of commission, special fee, money from any benefits
from company(like vechile and allowances like bills, health, rent and travel) additional benefits,
benefits through agreement(money at the time of aggrement) or benefits through changes in
agreement( is changes occure in aggrement) and any pension(monthly wise income after retirement)
are the income through salary and tax should be apply for such type of sasalaries. According to
Section 12, any allowances that given to employee For performance and any extra money that
employer gave by doing wrong reductions cannot be a part of salary and text in such a way of money
cannot be applied. Also if employer give employee tax then on such employee salary money tax
cannot be applied

Section 13 is about perquisite means any benefits that employer provides to the employee.
According to this section if employer give vechile to the employee then it's some value or some
money will be part of salary. To calculate this value (A×B)-C formula will be used. A means
purchasing price of such vehicle, B means if vchile is giving wholly then it's value is 15% and if it is
given partly the it's values is 7.5% and C is the money that employee give for such vehicle. If driver
and housekeeper is given to employee then there salary should be part of employee salary. If
employee takes loan and give interest then interest will be profit of organization and consider
income from salary. Also any benchmark(like if employee take interest-free loans or employee take
loan through less rate than the difference between them and benchmark will be 5 to 10%), any
services and utilities(like Gas,water and telephone Bill's) should be consider all of these a part of
employee salary and able for paying tax.

Section 14 is about that when employer gave share scheme to the employee then which type of
share scheme will be part of salary and tax apapplicable. According to this section if share schemes
have no restriction(employees transfer share then market value of share) and any profit for selling
shares will be a part of salary and tax should be applied. If employee who transfers share is part of
association company then some rules apply on such employee. Also if shares scheme have
restriction ( like not to transfer) then this is not a part of salary and tax not apply.

Section 149 is about that how much tax will be applying for salary income. According to this section
149, if employer cut tax from employee salary and if bank also cut tax from employee during bank
transaction then employee recollect tax amount from income-tax because he gave tax already. If
company pay meeting professionals then company will cut it's 20% of tax and if professions is not
able for tax then they recollect tax amount back from income tax. Those whose income from salary
is more than 50% of total income then they will be able to give text and also exemption on such
salaries is 400000. If employee salary is between 40000 to 800000 then tax is 1000 rupees only. If
employee salary is between 800000 to 1200000 then tax amount is 2000 rupees only. other tax rate
will be given below table on such type of salary.
 No. Gross amount Tax amount(Rs)
1 Less than 400000 0
2 Between 400000 to 800000 1000

3 Between 800000 to 1200000 2000

4 Between 1200000 to 2500000 5% of exceeding amount of
1200000
5 Between 2500000 to 4000000 65000 plus 15% of exceeding
amount 2500000
6 Between 4000000 to 8000000 290000 plus 20% of exceeding
amount of 4000000
7 More than 8000000 1090000 plus 25% of
exceeding amount 8000000

If employee salary is 75 percent from total income then assumption is 600000 and following rate will
be apply that is given below table.

No Gross income Tax rate(Rs)

1 Less than 0
600000
2 Between 5% of gross
600000 to amount
1200000 exceeding Rs
60000
3 Between 30000 plus 10%
1200000 to of exceeding
1800000 amount Rs
1200000
4 Between 90000 plus 15%
1800000 to of exceeding
2500000 amount Rs
1800000
5 Between 195000 plus
2500000 to 17.5 % of
3500000 exceeding
amount Rs
2500000
6 Between 370000 plus
3500000 to 20.5% of
5000000 exceeding
amount Rs
3500000
7 Between 670000 plus
5000000 to 22.5% of
8000000 exceeding
amount Rs
5000000
8 Between 1345000 plus
 8000000 to 25% of
12000000 exceeding
amount Rs
8000000
9 Between 2345000 plus
12000000 to 27.57% of
30000000 exceeding
amount Rs
12000000
10 Between 7295000 plus
30000000 to 30% of
50000000 exceeding
amount Rs
30000000