Computation of Taxable income of an individual

NAME OF TAXPAYER :
NTN TAXPAYER :
TAX YEAR :
RESIDENTIAL STATUS :
PERSON STATUS :
NOTES Total Exempted Rs. Taxable
Rs. Rs.
Income from salary:
Basic salary Xx - xx
Dearness allowance Xx - xx
Cost of living allowance Xx - Xx
Bonus Xx - xx
Commission/fee Xx - Xx
Leave encashment 1 Xx - xx
Overtime payment Xx - xx
Total
Allowances:
Medical allowance Xx Exempt up to xx
10% basic
salary
House rent allowance Xx - xx
Entertainment allowance Xx - xx
Travelling allowance Xx - Xx
Utilities allowance Xx - xx
Overseas allowance Xx - xx
TA/DA or special allowance 2 Xx Xx -
Senior post allowance Xx - xx
Total
Facilities:
Medical facility 3 Xx Xx -
Higher of
Rent free accommodation provided by Annual rental
4
employer value OR 45% of
basic salary
Car provided by the employer: 5
For office work only xx -
For private use only 10% of value of
car
For both use 5% of value of
car
Interest on loan provided by employer If loan is less Loan
than Rs. 1
million , no amount*(10%-
tax will be interest charged
charged
by employer)
Salary of domestic servant paid by xx
employer
Obligation of employee Xx - xx
waive/paid/reimbursed by employer
Reward/Asset paid/transferred by Fair market value
employer
Leave fare assistance Xx - xx
Entertainment facility Xx Xx -
(free/reimbursement/subsidized)
Provident fund:
Employee contribution - - -
Employer contribution 6 Xx Exempt up to xx
lessor of 10%
of salary or
Rs. 150,000
Interest credited 6 Xx Exempt xx
higher of 1/3rd
of salary or
amount
calculated at
16%
Accumulated balance - - -
Gratuity /accumulated pension:
Government Xx Fully exempt -
Approved under Income tax Xx Fully exempt -
ordinance, 2001, by the commissioner
Un-recognized fund but scheme is Xx Exempt up-to xx
approved by the board Rs. 300,000
Any other 7 Xx Lessor of xx
Rs.75,000 or
50% of
amount
Pension 8 Xx - xx
Any other benefit or allowances Xx - xx
Waiver of amount payable by Xx - xx
employee
Total taxable income from salary xx

Income from property: NOTES Total Exempted Taxable

(separate block of Rs. Rs. Rs.
income/Normal income)
Annual rent received Higher of actual rent or xx - xx
FMR is taxable
𝑈𝑛𝑎𝑑𝑗𝑢𝑠𝑡𝑎𝑏𝑙𝑒 𝑎𝑑𝑣𝑎𝑛𝑐𝑒
Un-adjustable advance xx - xx
10 𝑦𝑒𝑎𝑟𝑠
Liability of landlord paid by Xx - xx
tenant
Forfeited token money Xx - xx
received
Rent chargeable to tax (RCT) xxx
Deductions:
1. Repair and 1/5th Of RCT
maintenance
2. Insurance premium Annual
insurance
premium
3. Local /property tax Actual
amount paid
4. Ground rent related Actual
with that property amount paid
 5. Profit on debt /Share Amount Interest on
of rent to HBFC borrowed for such amount
property paid
6. Rent collection/ Lower of Actual Up-to 4% of
collection charges or
Administrative RCT
4% of RCT
charges
7. Legal expenses on Actual
suit against the amount paid
property
Rent chargeable to Tax

Income from Business: NOTES Total Exempted Taxable

Rs Rs Rs
Net profit/loss for the year
Add:
In-admissible deduction
Accounting depreciation
Less:
Tax depreciation
Admissible deduction
Carry forward of business loss
Total taxable income from business xx

Income from capital gain: NOTES Total Exempted Rs Taxable

Rs Rs
Gain on assets disposed of within 7 xx - xx
one year from the date of
acquisition
Gain on assets disposed of after Xx 25% gain 75% of gain
year from the date of acquisition
Less: carry forward of capital (xx)
losses
Total taxable income from capital gain xx

Income from other sources: NOTES Total Exempted Rs Taxable

Rs Rs
All other incomes that are not 7 xx - Xx
taxable under any above heads
will be taxable under income
from other sources

Total taxable income from other sources Xx

NOTES Total Exempted Rs Taxabl

Rs e
Rs
Total taxable income xx
from Salary
Total taxable income xx
from Property
Total taxable income
from Business
Total taxable income xx
from capital gain
Total taxable income xx
from other sources
Total income xx
Deduction:
1. Zakat paid xx
under zakat
and usher
ordinance
2. Contribution xx
to worker
welfare fund
3. Contribution xx
to worker
participation
fund
4. Profit on debt Lessor of
for house Actual profit on debt or
50% taxable income or
Rs.2000,000
If total annual taxable
5. Education income doesn’t exceed
Lessor of
expenses of Rs.1.5 million rupees 5% of total tuition fee or
children 25% of total taxable income or Rs.
60,000* nos. of children
Actual total taxable income xx
NOTES Total Exempted Rs Taxabl
Rs e
Rs
Add: Income xx
included for rate
purpose only
Share of profit from xx
AOP
Taxable income for xx
rate purpose
Computation of
taxable income:
Tax liability as per tax rate in first schedule of income tax ordinance, 2001 xxx
Less: Tax credits Amount of tax credits Amount eligible Tax
credits
Actual foreign tax paid OR (xx)
• Foreign tax 𝑇𝑎𝑥 𝑜𝑛 𝑡𝑎𝑥𝑎𝑏𝑙𝑒 𝑖𝑛𝑐𝑜𝑚𝑒∗𝑓𝑜𝑟𝑒𝑖𝑔𝑛 𝑠𝑜𝑢𝑟𝑐𝑒 𝐼𝑛𝑐𝑜𝑚𝑒
𝑇𝑎𝑥𝑎𝑏𝑙𝑒 𝐼𝑛𝑐𝑜𝑚𝑒
credit
Lessor of (xx)
• Investment in 𝑇𝑎𝑥 𝑜𝑛 𝑡𝑎𝑥𝑎𝑏𝑙𝑒 𝑖𝑛𝑐𝑜𝑚𝑒 ∗ 𝑎𝑚𝑜𝑢𝑛𝑡 𝑒𝑙𝑖𝑔𝑖𝑏𝑙𝑒
Cost of acquisition of shares or
shares 𝑇𝑎𝑥𝑎𝑏𝑙𝑒 𝐼𝑛𝑐𝑜𝑚𝑒 20% of taxable income or
Rs.2000,000
Lessor of (xx)
• Investment in Insurance premium paid during the year or
life insurance 20% of taxable income or
Rs.2000,000
 • Contribution Lessor of (Xx)
total actual contribution or
to approved 20% taxable income
pension fund
• Investment in Lessor of (Xx)
Insurance premium paid during the year or
health 5% of taxable income or
insurance Rs.150,000
• Charitable Lessor of (Xx)
Actual amount of charitable donation
donation during the year or
30% of taxable income
Gross Tax liability xxx
Less: reduction in
case of full time
teacher & researcher
(25%) (xx)
Total tax xx
Add: tax on income from property xx
Total tax liability under NTR: xx
Less: withholding taxes (xx)
Tax deducted at source (xx)

Net tax payables XX

Notes:

1. In case of government employees leave preparatory to retirement LPR will be exempted from tax.
2. Any allowance received for purpose of official duty is exempt from tax.
3. If both medical allowance and medical facility is provided, then medical allowance will fully taxable
4. If the house in provided in small cities, then 30% of basic salary is used instead of 45%.
5. Value of car;
Owned by employer: cost of car
Leased car: Market price
6. In case of government provident fund, employer contribution and interest credited are fully exempt. For
provident fund, salary means basic salary plus leave fare assistance
7. In case of government employee, gratuity received is fully exempt.
8. Only one pension with higher amount is exempt.
9. Capital gain on sale of immovable property with taxable under separate block of income
10. A deduction for education of children is only allowed if total taxable income of an individual is less than Rs
1500,000.
11. Capital Gain = Sales proceeds from capital assets – Price paid to acquire such assets
12. If the capital assets was acquired through gift/inheritance then Price paid to acquire such assets = FMV at
the date of transfer
13. Capital gain on immoveable property

S.No. Holding period Gain

1. Where the holding period of an immovable
property does not exceed one year A

2. Where the holding period of an immovable

property exceeds one year but does not exceed
two years A*3/4
 3. Where the holding period of an immovable
property exceeds two years but does not exceed A*1/2
three years

4. Where the holding period of an immovable

property exceeds three years but does not A*1/4
exceed four years

5. Where the holding period of an immovable 0%

property exceeds four years

14. Capital gain on moveable property

S.No. Holding period Gain

1. Where the holding period of an movable property
property does not exceed one year A

2. Where the holding period of an movable property

property exceeds one year but does not exceed
two years A*3/4