SALIENT FEATURES

FIANCNE ACT 2024

Income Tax Ordinance, 2001

1. 4AB Surcharge on Tax able Income

A surcharge at the rate of 10% of Income Tax shall be imposed where Taxable income of
an Individual and AOP Exceeds Rs. ten million

2. Section 92 Principles of taxation of associations of persons

Association of persons having turnover of three hundred million rupees or more required
file its audited accounts otherwise the income of member of the association of persons
shall not be exempt from tax

3. Section 100BA Special provisions relating to persons not appearing in active

taxpayers’ list.
A new category of persons who have filed return but not within due date is introduced

4. Section 108 Transactions between associates

A person paying royalty for use of brand/logo to its associate and also claiming
advertisement expense, twenty five percent of the advertisement expense shall be
allocated to the associate.

5. Section 114B Powers to enforce filing of returns.

Where persons don’t file their tax return even after issuance of notice for filling of return
and their name have been mentioned in Income Tax General Order, my be restricted to
exit from Pakistan. This condition shall not apply for Hajj, Umrah, Students and Overseas
Pakistanis holding NICOP.

6. Section 116 Wealth Statement.

Foreign assets are also included in wealth statement previously these assets were declared
in section 116A statement of Foreign Assets.

7. Section 121 Best judgment assessment

Commissioner is allowed to make best judgment assessment for discontinued business.

8. Section 147 Advance tax paid by the taxpayer

Turnover shall be estimated as equal to 120% of turnover of last year for calculation of advance
tax where the turnover is not known. This Ratio was 110% before finance act 2024.
 Commissioner may reject the estimates filled by the tax payer where the commissioner is not
satisfied with the documentary evidence provided for turnover estimates.

9. Section 148 Imports

FBR empowered to declare a minimum value of certain imported goods for the purpose of
computation of advance tax collection at import stage.

10. Section 153 Withholding Tax

Power of commissioner regarding issuance of Exemption Certificated is restricted upto
80% of Applicable Tax against payments to resident and non-resident persons (not
subject to minimum tax)

11. Section 154 Exports

Exporters of goods are brought into the normal tax regime whereby the withholding tax
collected is to be treated as minimum tax. Introduction of additional advance tax at the
rate of 1% of export proceeds, which is adjustable.
Furthermore, in addition to currently applicable 1% withholding tax, an additional
advance tax at the rate of 1% shall also be collected from direct exporters of goods,
which shall not be treated as minimum tax and in case of any incremental tax liability, the
exporter shall be able to adjust such advance tax.

12. Section 159 Exemption or lower rate certificate “Omitted in Finance Act”
Facility of exemption certificate against certain withholding provisions is withdrawn henceforth
the commissioner will only be able to issue reduced rate certificate. This provision shall affect
the person having exempt income (Provident fund) and Electricity exemption of Kamal Limited.

13. Section 236 G and 236 H Advance tax on sales to distributer and Retailers.
Provisions relating to advance tax collection from distributors, wholesalers, retailers extended to
all business sectors. Previously this provision was for distributes of certain class of business.

14. First Schedule

Part 1 Division I Rates of Tax for Individuals

A) TAX RATE FOR NON-SALARIED INDIVIDUALS / AOPs

Sr Taxable income Existing Incremental New Incremental

1 Upto Rs 600,000
2 Exceeding Rs 600,000 upto
Rs 800,000
3 Exceeding Rs 800,000 upto
Rs 1,200,000
Rates Rates
- -
7.5% of the amount
exceeding Rs 600,000
15% of the amount
15000+ 15% of the amount
exceeding Rs 600,000
exceeding Rs 800,000
 4 Exceeding Rs 1,200,000
upto Rs 1,600,000
5 Exceeding Rs 1,600,000
upto Rs 2,400,000
6 Exceeding Rs 2,400,000
upto Rs 3,000,000
7 Exceeding Rs 3,000,000
upto Rs 3,200,000
8 Exceeding Rs 3,200,000
upto Rs 4,000,000
9 Exceeding Rs 4,000,000
upto Rs 5,600,000
10 Exceeding Rs 5,600,000
B) TAX RATE FOR SALARIED INDIVIDUALS
Sr Taxable income
1 Upto Rs 600,000
2 Exceeding Rs 600,000 upto
Rs 1,200,000
3 Exceeding Rs 1,200,000
upto Rs 2,200,000
4 Exceeding Rs 2,200,000
upto Rs 2,400,000
5 Exceeding Rs 2,400,000
upto Rs 3,200,000
6 Exceeding Rs 3,200,000
upto Rs 3,600,000
7 Exceeding Rs 3,600,000
upto Rs 4,100,000
8 Exceeding Rs 4,100,000
upto Rs 6,000,000
9 Exceeding Rs 6,000,000
C) Rate of Tax for Mutual Funds
75,000+ 20% of the amount
exceeding Rs 1,200,000
315,000+ 25% of the amount
exceeding Rs 2,400,000
315,000+ 25% of the amount
exceeding Rs 2,400,000
465,000+ 30% of the amount
exceeding Rs 3,000,000
765,000 + 35% of the amount
exceeding Rs 4,000,000
Existing Incremental
Rates
- -
2.5% of the amount exceeding Rs
600,000
15,000 +12.5% of the amount
exceeding Rs 1,200,000
165,000 +22.5% of the amount
exceeding Rs 2,400,000
435,000 + 27.5% of the amount
exceeding Rs 3,600,000
1,095,000 6 + 35% of the amount
exceeding Rs 6,000,000
Rs. 90,000 + 20% of the
amount exceeding Rs
1,200,000
Rs. 170,000 + 30% of the
amount exceeding Rs
1,600,000
Rs. 650,000 + 40% of the
amount exceeding Rs.
3,200,000
Rs. 1,610,000 + 45% of the
amount exceeding Rs.
5,600,000
New Incremental
Rates
5% of the amount exceeding
Rs 600,000
30,000 + 15% of the amount
exceeding Rs 1,200,000
Rs. 180,000 + 25% of the
amount exceeding Rs.
2,200,000
Rs. 430,000 + 30% of the
amount exceeding Rs.
3,200,000
Rs. 700,000 + 35% of the
amount exceeding Rs.
4,100,000
 Advance Tax enhanced on dividend received from a mutual fund from 10% to 15% this Rate shall
further increase where mutual fund is deriving 50% or more of its income from profit on debt
from 15% to 25%.

D) DIVISION VII Capital Gains on Disposal of Securities

Fixed the tax rate for capital gain on securities to 15% for securities acquired on or after 01 July,
2024 irrespective of the holding period.

E) Division VIII Capital Gain on Disposal of Immovable Property.

fix the tax rate for capital gain on immovable property to 15% for property acquired on or after
01 July, 2024 irrespective of the holding period. Complete tax schedule is as under;

Rate of Tax on properties acquired on Rate of Tax on

or before 30th day of June, 2024 properties acquired
S. No Holding Period
Open Plots Constructed Flats on or after 1st day of
Property July, 2024
Where the holding 15% 15% 15% 15% for persons
period does not appearing on the
exceed one year Active Taxpayers’ List
Where the holding 12.5% 10% 7.5 % on date of disposal of
period exceeds property
one year but does
not exceed two For not active Tax
years Payers, Higher
Where the holding 10% 7.5% - of ,15% or at the Rate
period exceeds applicable for
two years but Business individual /
does not exceed AoPs and in case of
three years companies 29%
Where the holding 7.5% 5% -
period exceeds
three years but
does not exceed
four years
Where the holding 5% - -
period exceeds
four years but
does not exceed
five years
Where the holding 2.5% - -
period exceeds
five years but
does not exceed
six years
Where the holding 0% - -
period exceeds six
 years

F) Part III Division III Payment for Goods and services

Withholding tax for Toll Manufacturing is separated from other sale of Goods as 9% for companies
and 11% for other than companies.

G) Part III Division IV Exports

In addition to 1% Tax on Export Proceeds and additional tax of 1% shall be deducted from
proceeds of export.

H) Part IV division X Advance tax on sales of immoveable Property (236C) (Existing

rate is 3%)
SR No Amount Tax Rate Tax Rate Tax Rate
for Fillers for Late for Non
fillers fillers
1 Where the gross amount of the consideration 3% 6%
received does not exceed Rs. 50 million
2 Where the gross amount of the consideration 3.5% 7%
received exceeds Rs. 50 million but does not exceed 10%
Rs 100 million
3 Where the gross amount of the consideration 4% 8%
received exceeds Rs. 100 million

I) Part IV division XVIII Advance tax on Purchase of immoveable Property (236K)

(Existing rate is 3%)

SR No Amount Tax Rate Tax Rate Tax Rate

for fillers for Late for Non
fillers fillers
1 Where the fair market value does not exceed Rs. 50 3% 6% 12%
million
2 Where the fair market value exceeds Rs. 50 million 3.5% 7% 16%
but does not exceed Rs 100 million
3 Where the fair market value exceeds Rs. 100 million 4% 8% 20%

SALES TAX ACT 1990:-

1) Section 11D. Best judgment Assessment
 Concept of Best judgement Assessment is introduced in Sales Tax. Previously that was available
in Income tax.
2) Local Purchase Under EFS (Fifth Schedule)
Goods Specified in Fifth Schedule are subject to sales tax at the rate of zero per cent. Entry
appearing at SR 21 regarding local purchase of Goods under EFS is omitted.
3) Sales Tax on Retailers Integrated with POS system (Eighth Schedule)
Goods specified in the Eighth schedule shall be charged to tax at special Rates.
Entry No 66 regarding Reduced rate on supplies from Integrated retail outlet is omitted this shall
increase the rate of GST from 15% to 18%