06-05-2009, 10:00 PM
Farhan,Income Tax on payment made to Petrol Pumps and Advertising Agents is to be deducted on their commission and not on the Bill amount.
The commission on which Income Tax is to be deducted
Commission 10% of the bill amount
Rate of Income tax is 3.5% on commission.
Actually the principal of petrol pumps & Advertising Agencies deducts Income Tax @ 10% before making the payment of commission to petrol pump Dealer therefore the aforesaid deduction is double but no specific provision of exemption is available in the Ordinance, However according to Circular No.25 of 1980 dated 23.09.1980 the F.B.R has authorized C.I.T to issue the exemption certificate with regards to W.H.T to Petrol Pump Dealers and Advertising Agencies,so that on the production of such certificate, the responsibility to deduct Income Tax shall be ceased.
Best Regards
The commission on which Income Tax is to be deducted
Commission 10% of the bill amount
Rate of Income tax is 3.5% on commission.
Actually the principal of petrol pumps & Advertising Agencies deducts Income Tax @ 10% before making the payment of commission to petrol pump Dealer therefore the aforesaid deduction is double but no specific provision of exemption is available in the Ordinance, However according to Circular No.25 of 1980 dated 23.09.1980 the F.B.R has authorized C.I.T to issue the exemption certificate with regards to W.H.T to Petrol Pump Dealers and Advertising Agencies,so that on the production of such certificate, the responsibility to deduct Income Tax shall be ceased.
Best Regards
