Taxes on Newspaper Advertisements

Editor of Yahoo News · 09-23-2009, 01:32 AM

Itâs a nice forum for all concerned. I would like to know about the taxes which are applicable on advertisements being published in print media which are released through advertising agencies

thanks and Regards

faisal_desperado · 09-26-2009, 04:13 PM

<blockquote id="quote">quote<hr height="1" noshade id="quote">Originally posted by Editor of Yahoo News
 Itâs a nice forum for all concerned. I would like to know about the taxes which are applicable on advertisements being published in print media which are released through advertising agencies

thanks and Regards
<hr height="1" noshade id="quote"></blockquote id="quote">

Dear,

Under section 16A, part IV of the ordinance i.e. "EXEMPTION FROM SPECIFIC PROVISIONS"
The provisions of section 153(1)(b) shall not be applicable to the news print media services in respect of the advertising services. thus, no tax is required to be deducted while payment is made to the said service providers, provided that the payment has been made to resident person.

Regards,

awaisaftab · 09-26-2009, 04:30 PM

<blockquote id="quote">quote<hr height="1" noshade id="quote">Originally posted by Editor of Yahoo News
 Itâs a nice forum for all concerned. I would like to know about the taxes which are applicable on advertisements being published in print media which are released through advertising agencies

thanks and Regards
<hr height="1" noshade id="quote"></blockquote id="quote">

6% WHT is applicable and deducted for payments made in relation to share of newspaper. Even the payments to newspapers by AGPR (Accoutant General of Pakistan Revenue) and FBR for advertisement services are made after deducting taxes at the rate of 6% on the newspaper shares.

faisal_desperado · 09-26-2009, 04:40 PM

<blockquote id="quote">quote<hr height="1" noshade id="quote">Originally posted by awaisaftab
 <blockquote id="quote">quote<hr height="1" noshade id="quote">Originally posted by Editor of Yahoo News
 Itâs a nice forum for all concerned. I would like to know about the taxes which are applicable on advertisements being published in print media which are released through advertising agencies

thanks and Regards
<hr height="1" noshade id="quote"></blockquote id="quote">

6% WHT is applicable and deducted for payments made in relation to share of newspaper. Even the payments to newspapers by AGPR (Accoutant General of Pakistan Revenue) and FBR for advertisement services are made after deducting taxes at the rate of 6% on the newspaper shares.
<hr height="1" noshade id="quote"></blockquote id="quote">

Dear Awais,
I would request you to check the latest amendments made in the said section, i.e. added by the finance act 2009, the above has verbatim been quoted from the said section, furthermore, query is also concered with the taxation on print media advertisement.

The emphasis is on Bold above.

Best Regards,

awaisaftab · 09-26-2009, 05:21 PM

I will see the finance act there may be a change. I left the job of Advertising agency in may,2009 but till june 2009 it was practice for both print media and electronic media advertisement.

Editor of Yahoo News · 09-26-2009, 08:54 PM

Thanks a lot dear Faisal and Awais

Faisal you are correct. I appreciate for your timely given information.Taxes on Print media advertisements were abolished with effective from 1st of July 2009. prior to that advertising agencies were deducting Taxes from our bills.
But I need to know one more thing, we got advertisement from various organization including CDGK.CDGK Advertisements are released to us through a agency namely kimco,Normally Kimco release the payments of ads after 90 days. so my question is that "The accountant of Kimco Mr Umar Rathore has been deducting 6 percent WHT from our payments, I told him that 6 percent Tax has been abolished since 1st of July so he could not deduct that tax from our bills payment. But that acounatnt of Kimco said that since the ads were released in May June 2009 period so we(Yahoo News ) are liable to pay 6 Percent WHT from our payments which are given to us in September 2009.

To cut the story short. Can any ad agency deduct the 6 Percent WHT from the payments which are given to us after 15th September 2009? although the Release orders of Ads were issued in May June 2009 and ads were subsequently published in Yahoo News in May June 2009. but the payment was issued to us after 15 September.
Kindly elaborate whether the Accountant of Kimco is correct or not?

Thanks a lot for your precious advices

faisal_desperado · 09-28-2009, 06:00 PM

Dear,
The said agency is obliged to deduct tax from your invoice, since the event has been taken place before the exemption could have been provided, Had the event been taken place after July 09 then no tax would have been withheld.

However, there is a great certainity that, after manipulation, the said agency would evade tax payment,since this has now been abolished and will be easy for him to deduct payment from your invoice by falsification but avoid paying the same to make its own black money.

To tackle the aforesaid problems, you are required to;

- Let him deduct tax by whatever percent and ask for the tax challan, that will be evidence for you that tax has been deposited by KIMCO.

- If KIMCO does not provide tax challan within 15 days of the payment(after he pays you) then ask for the amount deducted by him on the grounds that tax has not been deposited by them.

- Time and again ask for either tax challan or amount deducted on account of tax.

- If you have not filled your return of tax yet then claim the same in the tax return, i.e. a rebate in tax should be claimed.

- If you have filled tax return for the year then tax deducted by KIMCO will be carried forward as per the rules provided in the ordinance.

Queries will be appreciated , if asked

Best Regards,

baigji · 09-29-2009, 04:23 AM

kiya koi bata saktay hu k aik normal admi salaried person income tax aur FED return kaisay claim karasakta hai??????????????/

Farhan2009 · 10-01-2009, 07:01 PM

<blockquote id="quote">quote<hr height="1" noshade id="quote">Originally posted by faisal_desperado
 Dear,
The said agency is obliged to deduct tax from your invoice, since the event has been taken place before the exemption could have been provided, Had the event been taken place after July 09 then no tax would have been withheld.

However, there is a great certainity that, after manipulation, the said agency would evade tax payment,since this has now been abolished and will be easy for him to deduct payment from your invoice by falsification but avoid paying the same to make its own black money.

To tackle the aforesaid problems, you are required to;

- Let him deduct tax by whatever percent and ask for the tax challan, that will be evidence for you that tax has been deposited by KIMCO.

- If KIMCO does not provide tax challan within 15 days of the payment(after he pays you) then ask for the amount deducted by him on the grounds that tax has not been deposited by them.

- Time and again ask for either tax challan or amount deducted on account of tax.

- If you have not filled your return of tax yet then claim the same in the tax return, i.e. a rebate in tax should be claimed.

- If you have filled tax return for the year then tax deducted by KIMCO will be carried forward as per the rules provided in the ordinance.

Queries will be appreciated , if asked

Best Regards,

<hr height="1" noshade id="quote"></blockquote id="quote">

Dear Faisal,

I think the time of deduction of tax is at the time of payment so if the at the time of payment the law has been changed then tax would not be dudected from the payamnets.

For your reference the section is reproduced

Every prescribed person making
a payment in full or part including a payment by way of advance to a resident
person or permanent establishment in Pakistan of a non-resident person -
(a) for the sale of goods;
(b) for the rendering of 1[or providing of] 2[ ] services;
(c) on the execution of a contract, other than a contract for the
3[sale] of goods or the rendering of 4[or providing of] 5[ ]
services,
shall, at the time of making the payment, deduct tax from the gross amount
payable at the rate specified in Division III of Part III of the First Schedule.

awaisaftab · 10-02-2009, 04:14 PM

It is very clear in ITO that the tax will be deducted at the time of making payment. So in my opinion the WHT agents should follow the law which exists at the time of making payment regardless of transaction period.

faisal_desperado · 10-03-2009, 05:32 AM

Dear Farhan and Awais,

Although a correct section has been quoted, which indicates that tax should be deducted at the time of payment, however the section does not reveal any thing with regards to the transaction period, this is not staggering that the tax should be deducted at the time of payment, definitely, tax will always be deducted at the time of payment and it can not be deducted before payment is made.

Furthermore, almost all the payments of goods and services are paid in the starting of the next month, likewise, Goods and services purchased in the month of June is paid in the next month i.e. July but still the rates applicable in June hold good.

Salaries of employees under section 149, for the month of June is paid in the 1st quartile of July, in most of the cases, however the same tax rates are applied as applicable in June, regardless of the fact that the tax rates have been revised for the next tax year.

I expect the said examples are sufficed.

Regards,

Editor of Yahoo News · 10-06-2009, 01:39 AM

Dear Faisal ,Dear Awais,Dear Farhan and all of you
Thanks a lot for all of you.
Kimco accountant has been reluctant to issue chalans for the payment made in September 2009.
He has been saying that I donât need challan for filing of my returns for the years 2008-2009 as the financial year of tax period ends at 30th June 2009. And Yahoo News was paid in September 2009 so I donât need to refer that matter in my return of 2008-2009,according to him
Then I asked him to proved me the chalans for the period of 31 July 2008 to 3 0th June .2009, but he is delaying the issuance of tax challans for that period also.
I may explain that Kimco has been deducting withholding tax since 2007 from our Bills but they never issued any challans to us as we never asked for that. But when I asked them to provide me the challans , the Accountant said that he would provide me in a day or two but he failed to do so despite repeated reminders and passing of many weeks .
Now what Should we do? Should we complain that matter to tax authorities? The kimco accountant has deducted lacs of rupees from our bills since 2007.

faisal_desperado · 10-08-2009, 04:23 AM

Dear,

Your withheld amount is seems to have been defalcated since start, unfortunately, Our tax laws are silient as to what actions may be taken against such issues, when a prescribed person does not pay tax or issue challans. However, Laws suggest prescribe person to issue challans/certificate within the prescribed time to avoid penalty.

However, if you have any proof when reveals that your tax has been deducted then it would also be sufficed evidence, which could be used for the purpse of claiming tax while filling annual return.

If he has not paid tax so deducted, then ask for certificate which may be issued by him indicating therein the amount of tax deducted against your invoices,(which may also be used for tax claims) Also, morally persuade him to issue challans (or atleast certificate), ask their upper management regarding non issuance of challan, or ask for the amount of tax deducted by them on assumption of non payment.

Regards,

Faisal

Editor of Yahoo News · 10-25-2009, 06:27 PM

Thanks dear for your advices.we have been initiating proper actions against them for this cheating