07-21-2009, 09:07 PM
Dear Ali,
Your post shows that you are not running a full fledged advertising agency. An advertising agence is required to be accrediated with All Pakisstan Newspaper society (APNS) (for publication of ads) in newspapers, Pakistan Brodacasters Association (For broadcasting of ads on TV Channerl) and Prees Information Department (For serving Govt organizations). I think you are running a graphic house which produces different items for publicity of different businesses. Your business is some howe production business and does not fall within the meaning of advertisement services. The product produced by your business are supplies rather then Advertising Services. So please inform your clients that deduct withholding tax at the rate of 3.5% rather than 6%. Because your are provider of supplies (Goods) not provider of services.
It is common practice of advertising agencies that they also do such works and in advertising agencies we use a term Other Media for these activities to differenciate these activities from Electronic Media and Print Media.
Sales tax is not applicable on services provided by your business.
I want to give you an example.
If you want to sale a particular layout to an customer each you will make bill in the following manner
Designing and graphics charges- 10,000/-
Total Amount 10,000/-
Now your client is liable to pay 11600 and he will deduct tax @3.5%,(unless you provide advertising services through electronic or print media)
Client will pay you
Total Bill 10,000
Less Tax @% ============= <u> -600</u>
============================ 9,400
Regards,
Awais Aftab
Your post shows that you are not running a full fledged advertising agency. An advertising agence is required to be accrediated with All Pakisstan Newspaper society (APNS) (for publication of ads) in newspapers, Pakistan Brodacasters Association (For broadcasting of ads on TV Channerl) and Prees Information Department (For serving Govt organizations). I think you are running a graphic house which produces different items for publicity of different businesses. Your business is some howe production business and does not fall within the meaning of advertisement services. The product produced by your business are supplies rather then Advertising Services. So please inform your clients that deduct withholding tax at the rate of 3.5% rather than 6%. Because your are provider of supplies (Goods) not provider of services.
It is common practice of advertising agencies that they also do such works and in advertising agencies we use a term Other Media for these activities to differenciate these activities from Electronic Media and Print Media.
Sales tax is not applicable on services provided by your business.
I want to give you an example.
If you want to sale a particular layout to an customer each you will make bill in the following manner
Designing and graphics charges- 10,000/-
Total Amount 10,000/-
Now your client is liable to pay 11600 and he will deduct tax @3.5%,(unless you provide advertising services through electronic or print media)
Client will pay you
Total Bill 10,000
Less Tax @% ============= <u> -600</u>
============================ 9,400
Regards,
Awais Aftab
