07-05-2010, 05:42 AM
we pay tax on the net profit..and to find out net profit, we subtract CGS from G.P..the less the marketing and admin exp..(the normal procedure followed in INCOME STATEMENT...bla bla bla...and then u will find the net profit and the tax rate will applied on this profit in order to find out the tax liability...
THIS IS THE NORMAL TAX REGIME...
whereas, PRESUMPTIVE TAX REGIME means that we are actually PRESUMING some income which is not actually liable for tax rate..but we are presuming some income for the tax purposes...
FOR EXAMPLE...you made an import of 400,000
this is not your net profit..but for the tax purposes, the law will PRESUME that this is your net profit and apply the respective WHT rate on this...
THIS IS THE NORMAL TAX REGIME...
whereas, PRESUMPTIVE TAX REGIME means that we are actually PRESUMING some income which is not actually liable for tax rate..but we are presuming some income for the tax purposes...
FOR EXAMPLE...you made an import of 400,000
this is not your net profit..but for the tax purposes, the law will PRESUME that this is your net profit and apply the respective WHT rate on this...
