REVENUE DIVISION
CENTRAL BOARD OF REVENUE
******
C.No.1(5)WHT/96-Pt
CIRCULAR NO.08 OF 2002.
(INCOME TAX)
SUBJECT: CLARIFICATION REGARDING COLLECTION OF
ADVANCE INCOME TAX UNDER SECTION 236 OF THE INCOME TAX ORDINANCE, 2001 – FROM USERS
OF PREPAID CARD AND SUBSCRIBERS OF MOBILE PHONES.
Section 236 of the Income
Tax Ordinance, 2001 provides that in the case of users of pre-paid telephone
cards and subscribers of mobile telephones, withholding tax @ 10% of the amount
of bill or sales price of pre-paid telephone card shall be collected.
2. For implementation of this
change, meetings were held with the representatives of the companies dealing
with prepaid telephone cards. It is hereby clarified for information of all
concerned that cost of the card shall be the sales tax paid value of the card
as increased by 10% withholding tax. The following examples are given for
information and guidance:-
|
CARDS VALUE |
|
||||
|
Denomination Value |
Company Price |
GST @ 15% |
Value for withholding
tax |
Withholding tax @ 10% |
Total Card Value |
|
Rs. 600 |
474 |
71 |
545 |
55 |
600 |
|
Rs. 700 |
553 |
83 |
636 |
64 |
700 |
3. In the case of mobile
phone, withholding tax shall now be leviable @ 10% of
the amount of the bill.
4. In the case of PTCL land
lines there is no change in the old law which provides collection of
withholding tax at the following rates:-
i) exceeds Rs.1,000 but does not exceed Rs.2,000. Rs.50
ii) exceeds
Rs.2,000 but does not exceed Rs.3,000. Rs.100
iii) exceeds
Rs.3,000 but does not exceed Rs.5,000. Rs.200
iv) exceeds
Rs.5,000 Rs.300
5. It is also clarified for
the information of the tax payers that tax withheld under section 236 of the
Income Tax Ordinance, 2001 in the manner indicated above is an advance tax
which is adjustable against the final tax liability.
6. All withholding agents are
advised to collect the tax properly and deposit the same in the Bank/Treasury
within the stipulated time.
(Agha
Muhammad Shah)
Secretary(WHT)
Tele:9201448