17/04/2020
INCOME TAX ADJUSTMENT FOR SALARIED TAX PAYERS BY EMPLOYER BEING WITH HOLDING AGENT.
Do you know that your employer / company where you work can make income tax claim adjustment being a withholding agent?
As you know that your company is required to deducted tax at source on salary under section 149 and then this amount will be deposited to F.B.R Government of Pakistan and you do not need to pay tax on your Salary income as tax is already deducted & deposited by your employer ,
But before deducting Income tax payable on income chargeable under the head of salary of its employees every employer is allowed under section 149 to make such adjustments as may be necessary, for any excess deduction or deficiency arising out of any previous deduction or failure to make deduction during the Tax Year.
In order to facilitates the salary tax payers F.B.R has given the facility that Salary Tax Payer can take tax adjustments from the company so all employees must avail this opportunity
if you have already paid advance taxes in banks, motor vehicle registration authorities, telecommunication companies, electricity distribution companies, insurance companies, educational institutions, property registration/transferring authorities, airlines, etc. which are adjustable and the employees can get this his adjustment from their employers before release of salary for the month of June for the tax year
You just need to provide the evidence of advances tax deduction and fill the IT-3 Form Declaration by Salaried Persons & send this form with tax evidence to your Finance or H.R department
This form is easily available at F.B.R web side
https://www.fbr.gov.pk/categ/withholding-tax-forms/323
some time you just confuse that I am just a salary person and already paying taxes on salary but Income tax is also deducted in Banking Transactions by Bank, By Mobile Companies, on Property purchase/Sale and on Airlines, Car Purchased etc the problem is that there is a lack of Tax Knowledge & awareness you are not taking Tax Adjustments from your employer. So should contact their employers immediately well before processing of pay roll for June-2020
Example for your understanding
MR.ALI is a salary person he is working in ABC company where his gross salary is 800,000 his total tax liability is 8000 for the year 2019
(1st july 2019 to 30 june 2020 ) Till april his tax was deducted 6000 In the month of May he has purchased a car where has has paid motor vehicle registration fee 10,000 now he has already paid 10,000 on car purchased & 6000 on salary so he has paid total 16000/- but his tax must be just 8000/- so before processing salary for the month of June he can get tax adjustment of Rs 2000/- by providing relevant evidences of tax deduction. He needs to submit IT-3 Form with
Tax evidence of Rs.10, 000/- to HR/Finance department. 2000 next 2 month tax employer will.not deducted and remaining 6000 you will take refund by Fbr
Employer has limited righst to adjust the tax adjustments upto the remaining tax left for deduction.
You can get tax adjustments on following adjustable taxes.
Sr. Description Section
===============================================
1 Withdrawal from Pension Fund 156B
2 Cash Withdrawal from Bank 231A
3 Certain Banking Transactions 231AA
4 Motor Vehicle Registration Fee 231B(1)
5 Motor Vehicle Transfer Fee 231B(2)
6 Motor Vehicle Sale 231B(3)
7 Motor Vehicle Leasing 231B(1A)
8 Private Vehicle Tax 234
9 Electricity Bill of Domestic Consumer 235A
10 Telephone Bill 236(1)(a)
11 Cellphone Bill 236(1)(a)
12 Prepaid Telephone Card 236(1)(b)
13 Phone Unit 236(1)(c)
14 Internet Bill 236(1)(d)
15 Prepaid Internet Card 236(1)(e)
16 Domestic Air Ticket Charges 236B
17 Sale/Transfer of Immovable Property 236C
18 Functions/Gatherings Charges 236D
19 Educational Institution Fee 236I
20 Purchase/Transfer of Immovable Property 236K
21 Purchase of International Air Ticket 236L
22 Banking transactions otherwise than through cash 236P
23 Education related expenses remitted abroad 236R
24 Advance tax on general insurance premium 236U
25 Advance tax on life insurance premium 236U
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