Deductible Allowances & Rebates

Total Taxable Income Under NTR only XXX

Less: Deductible allowances

 Zakat Paid under Zakat & Ushr Ordinance (Sec-60) (X)
 Worker’s Welfare Fund (WWF) (Sec-60A) (X)
 Worker’s Profit Participation Fund (WPPF) (Sec-60B) (X)
 Deducible allowance on profit on debt (Sec-60C)
 Actual Markup/Profit paid/Share to HBFC
 Rs. 2,000,000
 50% of Taxable Income
lower one will be allowed (X)
 Deductible allowance for educational expense (Sec-60D)
 5% of tuition fee paid by the individual
 25% of Taxable Income
 Rs. 60,000 multiplied by the number of children of the individual
lower one will be allowed (X)

Total Taxable Income Under NTR only XXX

Taxation ( Salaried/ Non-Salaried)

Tax Liability Under NTR XXX

Tax Liability XXX

Less Tax Credits

Full Time Teacher or a Researcher Allowance (Separate Working) (X)
Foreign Tax Credit (X)

Average Relieves:
Donations to Charitable Institutions (61) K
Allowances for Investment in Shares / SUKUKS (Insurance Premium Paid) (62) L
On premium on health insurance (62A) L2
Contribution to an Approved Pension Fund (63) M

Tax credit on point of sale machine (64D) Y

𝑻𝒂𝒙 𝑨𝒔𝒔𝒆𝒔𝒔𝒆𝒅
Average Relieves = 𝒙 (𝐾, 𝐿, 𝐿2, 𝑀)
𝑻𝒂𝒙𝒂𝒃𝒍𝒆 𝑰𝒏𝒄𝒐𝒎𝒆
Add: Separate Block Income
Property Income Tax XXX
Capital Gain U/S 37-A XXX
Gain on disposal of property XXX
Golden Handshake XXX
Add: Tax on FTR XXX
Total Tax liability XXX

Less : Tax Deducted at source (XXX)

Less: FTR (XXX)
Less: All WHT (XXX)
XXX
Add: Tax Credit disallowed (If any) (X)

Tax Payable XXX

Type of Credit Conditions Necessary Calculation of Credit

Full Time Teacher or He should a full time teacher or a researcher,
Researcher Allowance  Employed in a nonprofit education or research Tax liability of salary x 25%
(Clause 2 part III of 2nd institution.
Schedule)  Institution is duly recognized by Higher Education
(FTTA) Commission (HEC),
 a Board of Education or
 a University recognized by the HEC, including
government training and research institution,

Foreign Tax Credit a) A person must be resident Lower of

u/s 103 (FTC) b) Foreign income is taxable in Pakistan Actual Tax Paid
c) There is no tax treaty between both countries. Or
d) Tax is paid within two years after the end of the The Pakistan tax payable in
tax year in which the foreign income to which the respect of the income at average
tax relates. rate of tax:
( see also losses chapter for more practice) 𝑭𝒐𝒓𝒆𝒊𝒈𝒏 𝑺𝒐𝒖𝒓𝒄𝒆 𝑰𝒏𝒄𝒐𝒎𝒆
𝒙 𝑻𝒂𝒙
𝑻𝒐𝒕𝒂𝒍 𝑻𝒂𝒙𝒂𝒃𝒍𝒆 𝑰𝒏𝒄𝒐𝒎𝒆
 Average Relieves
Type Conditions Amount Lower of Rs.
Paid by a crossed cheque or in kind to: Actual amount
 Any board of education, educational
Or
S 61 institution or any university in Pakistan run by
Donations to Charitable Govt. K
30% of taxable income
Institutions  any govt. hospital or relief fund
Any non-profit organization. (15%/10% for Associates)
 Entities mentioned in 13th Schedule
A resident filer person other than a company 1- Actual investment
Acquiring new shares OR SUKUKS offered to the
(shares, sukuks or
public by a listed or shares acquired from the
Privatization Commission of Pakistan (original insurance)
allottee).
2- 20% of taxable income
Shares are required to be held for 24 months from
S 62
the date of purchase. (reversal of tax credit) 3- Rs.2,000,000/-
Allowances for
OR
Investment in Shares
 Any life insurance premium paid on a policy to
(Insurance Premium L
a life insurance company registered by the
Paid)
Securities and Exchange Commission of
Pakistan.
(NOT FOR COMPANY)
 Having salary or business income
 Insurance and life insurance is not surrender
within 2 years of its acquisition (commissioner
will re-compute taxable income of previous
years)

S 62 A A resident filer person other than a company; 4- Actual amount

Tax Credit for Health insurance premium paid;
5- 5% of taxable income
Investment in Health To any insurance co. (registered under ins.
L2
Insurance Ordinance); & 6- Rs150,000/-
Deriving income from salary or income from
(FOR INDIVIDUAL ONLY) business.
An Individual holds NTN or Valid CNIC. Actual amount
Driving income under the head salary or income
or
S 63 from business.
Contribution to an Contributes or pay premium in the year in 20% of taxable income M
Approved Pension Fund approved pension fund under the Voluntary
Pension System Rules, 2005.

S 64 Any Person who is required to integrate with 1. Purchase cost of POS

Tax Credit on Point FBR’s system for real time reporting of sale or machine
Y
of Sales Machine receipt shall be entitled to tax credit on purchase 2. Rs. 150,000 per
cost of POS machine machine