Dear Members
What is the treatment of Tax Deducted on behalf of other parties and employees?
when it should be submitted to Tax Authority?
If the company does not repay it then what will happen?
Kind Regards
Shakeel Ahmad
<blockquote id="quote"><font size="1" face="Verdana, Arial, Helvetica, san" id="quote">quote<hr height="1" noshade id="quote"><i>Originally posted by mrshakeel786</i>
<br />Dear Members
What is the treatment of Tax Deducted on behalf of other parties and employees?
when it should be submitted to Tax Authority?
If the company does not repay it then what will happen?
Kind Regards
Shakeel Ahmad
<hr height="1" noshade id="quote"></font id="quote"></blockquote id="quote">
Hello There!
May I ask what specific other parties(foreign, etc.)? Anyways, I found this at the Web,
unpan1.un.org/intradoc/groups/public/documents/apcity/unpan020168.pdf
Hope it helps!
Hi Shakeel Ahmed,
All the companies are liable to deduct tax on services and supplies read section 149-153 of Income Tax Ordinance 2001. All partnership firms sole proprietor all liable to deduct tax on Salaries paid by them to employees, whose income is taxable (Currently the taxable limit for male employee is Rs 180,000 and for female employee is Rs.240, 000)
The small company defined in section 2(59A) of Income Tax ordinance is also not liable to deduct tax on Services and Supplies.
The tax deducted at source is liability of a business and shall be booked by passing following entry
For instance you are making a payment of Rs.50,000 for services to Mr.A,your creditor, you will pass following entry.
Dr.A 50,000
Cr. Bank 47,000/-
Cr. Tax deducted on services 3,000
The tax deducted at source should be deposited in the Govt Treasury by 15th day of next month.
so the total tax you deducted in the month of January 2009 should be deposited till 15th Feb 2009
The business which does not deduct tax shall be liable to deposit the amount of tax not deducted itself
The business that deducts the tax but not deposit the tax to Government than a fine can be imposed or an imprisonment or both.