Taxation

with focus on tax education

Witholding tax on freight charges
Friday, February 13, 2009

According to section 153 (Payments for goods and services) of Income Tax Ordinance, 2001 every prescribed person making a payment in full or part including a payment by way of advance to a resident person or permanent establishment in Pakistan of a non-resident person is required to deduct tax

for the sale of goods;
for the rendering of services;
on the execution of a contract, other than a contract for the supply of goods or the rendering services

Payment to transporters on account of freight charges are covered under rendering of services. Every prescribed person is required to deduct withholding tax @ 2.00% as mentioned in 2(i) division III, part III of first schedule of Income Tax Ordinance, 2001.

Labels: Taxation

posted @ 2:57 PM,

4 Comments:

At February 13, 2009 at 3:50 PM, Anonymous said...: Are accountants jumping on the blog bandwagon with the pundits and the journalists? Not in great numbers. But your blog seems to be very useful one. Keep it up man.
At February 16, 2009 at 6:15 PM, sammar said...: what about Rate of Tax Deduction on Sea Freight paid to shipping company
At February 7, 2017 at 12:43 PM, Unknown said...: Are freight forwarder exempt on sea & air international freight payments ?
If yes please provide me exemption certificate ?

Thanks
At February 11, 2019 at 1:22 AM, Judson Haggerty said...: Nice post! Thanks for sharing
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