Business & Taxation Laws
Four common types of business forms are adopted privately in Pakistan. These are:
To adopt one of the forms as mentioned above of businesses, the most suitable way is by registering for a limited liability company.
Business laws of Pakistan
Companies Ordinance, 1984
Under the Companies Ordinance, 1984, there are three types of companies:
The legal regime for the formation and regulation of companies in Pakistan is given in the Companies Ordinance, 1984. In contrast, the role of administration of these companies is given to the Securities and Exchange Commission of Pakistan and to the Registrar of Companies appointed by the SEC of Pakistan at a provincial level where such company is to be registered.
The limited liability company further has two types:
Registration of a limited liability company
Please refer to our section of company Registration for Further details.
The obligatory contribution in the revenue of the state by an individual upon the Income he/she generates on an annual basis is called a tax. There are two main types of taxation laws in Pakistan:
The tax an individual pays on his annual Income is called income tax. Income tax is divided into two basic categories:
The total sum of Income is attained after the deduction of:
Heads of Income
Under the Income Tax Ordinance, 2001. Incomes are divided into:
The taxation year in Pakistan is effective from 1st day of July and ends on 30th day of June.
Individual Income Tax
On personal Income, tax is applicable only if a person is earning more than Rs.600,000 annually. An individual is liable for paying tax fee, i.e. resident, if,
Income Of Individual
Under section 101 of the Income Tax Ordinance, 2001, tax is applicable on an individual when he generates Income from:
Corporate Income Tax
Under section 101 of the Income Tax Ordinance, 2001, tax is applicable on a corporate when it:
Under the Sales Tax Act, 1990, the federal government collects sales tax on the:
The federal government collects sales tax on services under The Islamabad Capital Territory Ordinance, 2001.
Property tax is a tax collected by the provincial government on land or a building on its annual value. The property tax is collected at a rate of 5% annually.
The property tax should be submitted before the 30th day of September every year.
Exemptions of property tax
Under the following conditions, property tax is exempted:
Our team of competent and experienced online lawyers in Pakistan offer the following services regarding taxation:
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