09-11-2007, 06:35 PM
Dear Zia,
This depends upon taxation status of the company making such payment. If it is filing statement under section 115 (4) following presumptive taxation regime (PTR), then there would be no consequences of using such money market channel and in fact this happens typically in all such companies which fall under PTR.
Further, where taxation is made under normal law (NTR), your observation appears to be correct. However, it again depends upon available tax losses and selection of such entity for detailed scrutiny/tax audit by FBR. All returns are now filed in the manner and style of universal self assessment scheme and very few cases having exceptional and noticable profile are selected for detailed audit by tax authorities.
Still, you are correct that there remains a reason to declare such expenses/costs paid through money market as in-admissible by taxation authroities under NTR.
However, so much happens practically everywhere to resolve or hide such transactions, which being un-ethical, I would not discuss.
Best regards,
Kamran.
This depends upon taxation status of the company making such payment. If it is filing statement under section 115 (4) following presumptive taxation regime (PTR), then there would be no consequences of using such money market channel and in fact this happens typically in all such companies which fall under PTR.
Further, where taxation is made under normal law (NTR), your observation appears to be correct. However, it again depends upon available tax losses and selection of such entity for detailed scrutiny/tax audit by FBR. All returns are now filed in the manner and style of universal self assessment scheme and very few cases having exceptional and noticable profile are selected for detailed audit by tax authorities.
Still, you are correct that there remains a reason to declare such expenses/costs paid through money market as in-admissible by taxation authroities under NTR.
However, so much happens practically everywhere to resolve or hide such transactions, which being un-ethical, I would not discuss.
Best regards,
Kamran.
