09-29-2011, 09:10 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 mzeeshanpk</i>
<br />kindly tell me if newly formed NGO has not yet obtained tax exemption certificate then is its income i.e. (surplus of income over expenses)is taxable under income tax ordinance.
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Exemption certificate has nothing to do with tax on surplus. The purpose of exemption certificate is to save oneself from withholding taxes. company is bound to deduct 3.5% tax on buying goods. However, if the seller produces exemption certificate ,company will not deduct/withhold tax.
On the other hand if you want to ask about tax on surplus. Surplus of non profit organizations are exempt under cl 58 of PartI 2nd Schedule of ITO, 2001. Whiled definition of Non Profit Organization in s.2 (36)contains a mandatory attribute of its being approved by Commissioner. Unless, NGO is approved by Commissioner as Non Profit Organization within the meaning of Income Tax Ordinance, 2001, its surplus is not exempt from tax.
<br />kindly tell me if newly formed NGO has not yet obtained tax exemption certificate then is its income i.e. (surplus of income over expenses)is taxable under income tax ordinance.
<hr height="1" noshade id="quote"></font id="quote"></blockquote id="quote">
Exemption certificate has nothing to do with tax on surplus. The purpose of exemption certificate is to save oneself from withholding taxes. company is bound to deduct 3.5% tax on buying goods. However, if the seller produces exemption certificate ,company will not deduct/withhold tax.
On the other hand if you want to ask about tax on surplus. Surplus of non profit organizations are exempt under cl 58 of PartI 2nd Schedule of ITO, 2001. Whiled definition of Non Profit Organization in s.2 (36)contains a mandatory attribute of its being approved by Commissioner. Unless, NGO is approved by Commissioner as Non Profit Organization within the meaning of Income Tax Ordinance, 2001, its surplus is not exempt from tax.
