Income from Business
This blog is written by Mr. Faisal Farooq, Associate Taxation and Corporate Services. Please read this blog and provide your valued comments.
Income from Business
The following incomes of a person for a tax year, other than income exempt from tax under this Ordinance, shall be chargeable to tax under the head “Income from Business”
The profits and gains of any business carried on by a person at any time in the year.
Any income derived by any trade, professional or similar association from the sale of goods or provision of services to its members.
Any income from the hire or lease of tangible movable property.
Any profit on debt derived by a person where the person’s business is to derive such income shall be chargeable to tax under the head “Income from Business” and not under the head “Income from Other Sources”.
Any amount received by a banking company or a non-banking finance company, where such amount represents distribution by a mutual fund out of its income from profit on debt, shall be chargeable to tax under the head “Income from Business.
That business shall be treated as distinct and separate from any other business carried on the person.
“Speculation business” means any business in which a contract for the purchase and sale of any commodity (including stocks and shares) is periodically or ultimately settled otherwise than by the actual delivery or transfer of the commodity, but does not include a business.
A contract in respect of raw materials or merchandise is entered into by a person in the course of a manufacturing or
Mercantile business to guard against loss through future price fluctuations for the purpose of fulfilling the person’s other contracts for the actual delivery of the goods to be manufactured or merchandise to be sold.
A contract in respect of stocks and shares is entered into by a dealer or investor therein to guard against loss in the person’s holding of stocks and shares through price fluctuations or
A contract is entered into by a member of a forward market or stock exchange in the course of any transaction in the nature of Jobbing to guard against any loss which may arise in the ordinary course of the person’s business as such member.