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Foreign Exchange Regaulations - Printable Version

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Foreign Exchange Regaulations - Aikkhilari - 01-30-2012 10:11 PM

Assalam-o-Alaikum
I have some queries related to FX regulations in Pakistan.

<b>Following is the situation</b><ol type="1">
<li>I have a proprietorship business registered under my name/CNIC</li>
<li>I provide software outsourcing services (Development) for which I get paid in GBP, directly deposited into my GBP account in Pakista</li>
<li>I file Personal Income Tax and declare all the Rupees equivalent of FX income as per prevailing FX rate.</li></ol id="1">

<b>Following are the queries</b><ol type="1">
<li>What are the restrictions/limits in place to get the FX converted from open market? </li>
<li>Can I get large sum of FX converted from a registered Money Changer with due documentation. What are the pitfalls and required caution with regards to regulations?</li>
<li>What are the restrictions/limit in place to transfer the FX from business account to personal account (both under the same CNIC)</li>
<li>Are there any restrictions on using the FX funds in my business account for personal use after declaring them on personal Income Tax.</li>

<li>What are the restrictions/limits in place to transfer any FX fund to an overseas account?</li></ol id="1">

Any pointer would be greatly appreciated.

Any link to a layman guide to Foreign Exchange regulations in Pakistan would be a great help

Thanks


- insaan - 01-31-2012 11:38 PM

1.i don't think there are any restrictions
2.yes
3.if both are being operated as separate entities, you'll have to take care while submitting return for you company and your personal tax return. other than that nothing
4. yes , considering you as a person and your company are separate legal entities and funds given to each other will be considered loans and receivables w.r.t your wealth statement and return etc
5.yes there are restriction regarding transferring fx funds to o/s Pakistan, you may consult an authorized dealer in this regards


- Aikkhilari - 02-02-2012 01:37 PM

<blockquote id="quote"><font size="1" face="Verdana, Arial, Helvetica, san" id="quote">quote<hr height="1" noshade id="quote"><i>Originally posted by insaan</i>
<br />3.if both are being operated as separate entities, you'll have to take care while submitting return for you company and your personal tax return. other than that nothing
<hr height="1" noshade id="quote"></font id="quote"></blockquote id="quote">

Thanks a lot of your reply.

I have the business name under my personal NTN# and file only the Personal IT returns with declaring "Businss Income/(Loss" (Line 29 on the return form). I believe that does not make my business a separate entity. The Business name also shows up on my IT returns.

I have been told that whatever income/funds are in my business account are deemed to be my personal funds. But as this is FX inflow, I want to be sure I am not going overboard using these funds for my personal use.


- insaan - 02-03-2012 01:54 AM

Ok in that case i dont think there will be any problem.

Regards