01-15-2005, 06:19 PM
Hi,
If zakat is paid under Zakat and Ushr Ordinance. then it is allowed as deduction...it is involved in the computation of total income of the taxpayer...so it is the personal matter of the taxpayer...and if Zakat is not paid under Zakat and Ushr Ordinance then no deduction will be allowed...
Examples
Total Income of the tax payer(including business income)is Rs 500000
Zakat is paid under Zakat and Ushr Ordinance during the year Rs 25000
Income tax will be calculated on Rs 475000(500000-25000)
Total Income of the tax payer(including business income)is Rs 500000
Zakat paid not according to Zakat and Ushr Ordinance during the year Rs 25000
Income tax will be calculated on Rs 500000...
In both the cases Zakat will not appear in the Financial Statements...So its not concerned with accounting...
Your second question is of the same nature...Charity recieved is shown in the income statement only...It is income if received...
If charity is paid it ll not appear in the income statement...however it ll be considered for tax purposes...same like Zakat...
Ace
If zakat is paid under Zakat and Ushr Ordinance. then it is allowed as deduction...it is involved in the computation of total income of the taxpayer...so it is the personal matter of the taxpayer...and if Zakat is not paid under Zakat and Ushr Ordinance then no deduction will be allowed...
Examples
Total Income of the tax payer(including business income)is Rs 500000
Zakat is paid under Zakat and Ushr Ordinance during the year Rs 25000
Income tax will be calculated on Rs 475000(500000-25000)
Total Income of the tax payer(including business income)is Rs 500000
Zakat paid not according to Zakat and Ushr Ordinance during the year Rs 25000
Income tax will be calculated on Rs 500000...
In both the cases Zakat will not appear in the Financial Statements...So its not concerned with accounting...
Your second question is of the same nature...Charity recieved is shown in the income statement only...It is income if received...
If charity is paid it ll not appear in the income statement...however it ll be considered for tax purposes...same like Zakat...
Ace
