Federal Board of Revenue FBR increased the limit of turnover for withholding agents. Taxpayers having turnover above Rs 100 million will need to deduction of withholding tax.
Income Tax Circular No. 03 of 2020 a day earlier issued by FBR. Through amendment in Income Tax Ordinance, 2001 via Finance Act, 2020.
Through amendment in finance act, from July 01, 2020, limit of turnover for an individual or an AOP for a withholding agent in terms of sub-section (7) of section 153 of the Ordinance increased from “Rs.50 million and above” to “Rs.100 million and above” in the previous tax year.
Amendment in finance act also affected taxpayers registered with sales tax, requirement to withhold income tax under section 153. From tax year 2021 taxpayers registered with Sales Tax and turnover of Rs.100 million or above in any of the previous tax years, now will require to withhold income tax.
Earlier, all sales tax registered persons require to withhold income tax under section 153. Now withholding of tax under above section limited to turnover above than Rs. 100 million in any previous tax year.
-Finance Act 2020 | FBR Budget Salient Features | Tax Year 2021 |