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Issuance of Tax Deduction Certificate by Agents
03-26-2009, 06:30 PM
Post: #1
Issuance of Tax Deduction Certificate by Agents
I am working with an advertising agency. In fact advertising agencies work as agent of both advertiser and electronic and print media. The share of advertising agencies is fixed @15%.

Suppose Pakistan Tobacco Company wants to publish its ad of specific size in tree newspapers namely

1.The News
2.Dawn
3.Jang

The rate of each newspaper is different assume the invoice amount becomes Rs.100,000/- the advertising agency submit the invoice alongwith the cuttings of newspapers .

Here the share of agency is Rs. 15,000/- and the remaining portion i.e. 85,000/.

The Pakistan Tobacco Company whose ad has been published through agency will devide the invoice amount in two portion and deduct withholding tax at the rates specified in ITO,2001. The calculation of WHT wiil be as follows

15,000 X 5% =750/- (U/S 233 of ITO 2001)
85,000 X 6% = <u>5,100/-</u> (U/S 153 of ITO 2001)
Withholding Tax<u>5,850/</u>

After deducting the tax of Rs. 5,850 the Pakistan Tobacco Company ( Advertiser) will make payment to the advertising agency . After receiving the payment the agency will pay the share of newspaper after adjusting 6% tax deducted by the Pakistan Tobacco Company (Advertiser)

Know the question arises here that who shall issue the Deduction and Collection Certificate to newspapers/TV Chaneels currently we are using our own format for issuing Deduction and Collection Certificate to newspaper . But these certificates are not accepted by some newspapers and TV Channel they demand from us issuance of Deduction and Collection Certificate on the prescribed format. We are unable to issue them such certificate because this certificate can only be issued by the person deducting the tax actually and being an agent we do not deduct tax rather we adjust the amount of tax deducted by the advertiser.

My question is that can we issue a certificate of Deduction and Collection Certificate on any other format (other than the format specified in tax law) on behalf of our principal (advertiser)?

Can we issue a certificate with the wording that " clients have deducted Rs. XXX while making payment to Daily Jang Rawalpindi"

If any one know about any circular/SRO of CBR/FBR or rule/section of IT Law , regarding the issuance of certificate by agent on behalf of Principal, then please inform me about the same with refereces.

If some one know about the practice of other type of commission agents, in this regard, such as travelling agents then please inform me.


Regards,

Awais
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Messages In This Thread
Issuance of Tax Deduction Certificate by Agents - awaisaftab - 03-26-2009 06:30 PM
[] - m_zeeshanuddin_sa - 03-26-2009, 07:22 PM
[] - awaisaftab - 04-03-2009, 07:48 PM
[] - Star - 04-04-2009, 04:21 PM
[] - awaisaftab - 04-06-2009, 07:47 PM
[] - m_zeeshanuddin_sa - 04-10-2009, 02:57 PM
[] - awaisaftab - 04-11-2009, 09:39 PM
[] - Shafiq - 04-20-2009, 04:24 PM
[] - m_zeeshanuddin_sa - 04-22-2009, 01:31 PM
[] - awaisaftab - 04-23-2009, 06:54 PM
[] - LapTop - 04-28-2009, 10:15 PM
[] - awaisaftab - 05-12-2009, 07:54 PM
[] - LapTop - 05-15-2009, 02:37 AM
[] - owais33 - 06-02-2010, 03:20 PM
[] - kinzamalik01 - 10-21-2011, 11:25 PM

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