03-20-2011, 11:25 PM
The Income Tax (Amendment) Ordinance, 2011 [â2011 Ordinanceâ] has inserted a new section 4A in the Income Tax Ordinance, 2001 [âthe Ordinanceâ] to provide for levy of âSurchargeâ at the rate of 15% on income tax payable by every taxpayer as income tax liability, advance tax and withholding tax (as withholding agent) etc. The Surcharge is payable
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on income tax liability pertaining to tax year 2011; and
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on taxes deducted / collected during the period from 15 March 2011 to 30 June 2011 by any withholding tax agentFurther, Surcharge shall be paid, collected, deducted and deposited at the same time and in the same manner as the tax is paid, collected, deducted and deposited on account of income tax liability, advance tax, withholding taxes etc.Based on the provisions of section 4A, the following position emerges
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All taxpayers whose tax year 2011 [i.e. income year ended between 01 July 2010 to 31 Dec 2010] has already been closed, they are required to pay surcharge on their whole yearâs tax liability at the time of filing of return. Such taxpayers would not be required to pay surcharge on March and June 2011 Quarters advance tax liability as the two quarters would fall within tax year 2012. Further, such taxpayers would not be subject to surcharge on withholding taxes on their receipts as the same would not fall within tax year 2011 but tax year 2012.
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Such taxpayers, where tax year 2011 has not yet closed, they would be subject to surcharge on withholding taxes on their receipts from 15 March 2011 until year end or 30 June 2011 whichever is earlier. Such taxpayers would also be required to compute surcharge on advance tax liability for March 2011 and June 2011 Quarters (where any such quarter falls within tax year 2011). Furthermore, such tax payers will be required to compute surcharge liability on full year's income tax liability and pay the differential surcharge i.e. after adjustment of surcharge withheld by the withholding agents between 15 March 2011 and 30 June 2011 and surcharge paid in advance, at the time of filing of their return.
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Surcharge will also be applicable on receipts / income falling under presumptive regime covered within tax year 2011.
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Employers would be required to withhold tax computing surcharge on full yearâs tax liability of the employees (i.e. from 01 July 2010 to 30 June 2011) and deduct the same until 30 June 2011.
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Withholding agents are required to deduct / collect surcharge at 15% of the amount of tax deducted / collected and deposit the same in the same manner as is done in the case of tax deducted / collected.
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on income tax liability pertaining to tax year 2011; and
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on taxes deducted / collected during the period from 15 March 2011 to 30 June 2011 by any withholding tax agentFurther, Surcharge shall be paid, collected, deducted and deposited at the same time and in the same manner as the tax is paid, collected, deducted and deposited on account of income tax liability, advance tax, withholding taxes etc.Based on the provisions of section 4A, the following position emerges
#9632;
All taxpayers whose tax year 2011 [i.e. income year ended between 01 July 2010 to 31 Dec 2010] has already been closed, they are required to pay surcharge on their whole yearâs tax liability at the time of filing of return. Such taxpayers would not be required to pay surcharge on March and June 2011 Quarters advance tax liability as the two quarters would fall within tax year 2012. Further, such taxpayers would not be subject to surcharge on withholding taxes on their receipts as the same would not fall within tax year 2011 but tax year 2012.
#9632;
Such taxpayers, where tax year 2011 has not yet closed, they would be subject to surcharge on withholding taxes on their receipts from 15 March 2011 until year end or 30 June 2011 whichever is earlier. Such taxpayers would also be required to compute surcharge on advance tax liability for March 2011 and June 2011 Quarters (where any such quarter falls within tax year 2011). Furthermore, such tax payers will be required to compute surcharge liability on full year's income tax liability and pay the differential surcharge i.e. after adjustment of surcharge withheld by the withholding agents between 15 March 2011 and 30 June 2011 and surcharge paid in advance, at the time of filing of their return.
#9632;
Surcharge will also be applicable on receipts / income falling under presumptive regime covered within tax year 2011.
#9632;
Employers would be required to withhold tax computing surcharge on full yearâs tax liability of the employees (i.e. from 01 July 2010 to 30 June 2011) and deduct the same until 30 June 2011.
#9632;
Withholding agents are required to deduct / collect surcharge at 15% of the amount of tax deducted / collected and deposit the same in the same manner as is done in the case of tax deducted / collected.
