ALLAMA IQBAL OPEN UNIVERSITY, ISLAMABAD

(Department of Commerce
TA!ATION MANA"EMENT (#$%&
C'EC(LIST
SEMESTER) SPRIN", *+&,
This packet comprises the following material:
1. Text Book (One)
2. Course Outline
3. ssignment !o. 1" 2
#. ssignment $orms (2 sets)
%n this packet" if &ou fin' an&thing missing out of the a(o)e mentione' material" please
contact at the a''ress gi)en (elow:
*ailing Officer
llama %+(al Open ,ni)ersit&
-./" %slama(a'
Muhammad Munir
(Course Coor'inator)
Final on 17-02-
2014
ALLAMA IQBAL OPEN UNIVERSITY, ISLAMABAD
(Department of Commerce
[
-ARNIN"
&. PLA"IARISM OR 'IRIN" O/ "'OST -RITER(S /OR SOLVIN"
T'E ASSI"NMENT(S -ILL DEBAR T'E STUDENT /ROM A-ARD
O/ DE"REE0CERTI/ICATE, I/ /OUND AT ANY STA"E.
*. SUBMITTIN" ASSI"NMENTS BORRO-ED OR STOLEN /ROM
OT'ER(S AS ONE1S O-N -ILL BE PENALI2ED AS DE/INED IN
3AIOU PLA"IARISM POLICY4.
Co5r6e) Ta7at8on Mana9ement (#$%& Seme6ter) Spr8n9, *+&,
Le:e;) M. Com Mar<6) &++
Pa66 Mar<6) $+
ASSI"NMENT No. &
0. 1 (a) 1rite a (rief note on Tax 'ministration 2eforms 3rogram. ($
(() 1rite a 'etaile' not on the 4uris'iction an' components of %ncome Tax 5aw
in 3akistan. (&$
0. 2 (a) 6escri(e exemptions allowe' un'er %ncome Tax 5aw un'er the source of
income from salar&. (&+
(() 6escri(e exemptions allowe' un'er %ncome Tax law un'er the source of
income from (usiness. (&+
0. 3 $rom the following information relating to tax &ear 2713" compute tax lia(ilit& of
*r. $aisal" a senior citi8en: (*+
Deta8;6 Amo5nt R6.
9alar& (per month) 127"777
5oan wai)e' (& emplo&er 277"777
3rofit on Beh(oo' 9a)ing Certificates 177"777
5ea)e fare assistance (within 3akistan) 27"777
5ea)e fare assistance (outsi'e 3akistan) 177"777
,nappro)e' gratuit& recei)e' /77"777
%ncome from non.speculation (usiness from ,:. 3ai'
tax to ,: go)ernment 2s.;;"777 377"777
%ncome from non.speculation (usiness from ,:. 3ai'
tax to ,: go)ernment 2s.37"777 277"777
%ncome from other sources from ,:. 3ai' tax to ,:
go)ernment 2s./"777 127"777
3ension 127"777
<roun' rent 177"777
2
5ife insurance premium pai' (& emplo&er 37"777
3ri8e on pri8e (on' =7"777
Capital gain on sale of shares of a pri)ate compan& (sol'
within 12 months) 177"777
Capital loss on sale of shares of other pri)ate compan& #7"777
-on'a Ci)ic car is pro)i'e' (& the emplo&er for his official as well as personal
use. Car costs 2s.1/"77"777.
0. # >xplain the re+uirements an' con'itions of registration an' 'e.registration un'er
section 1# an' 21 of 9ales Text ct" 1??7. lso explain the proce'ures for each of
them. (*+
0. ; @amil 6air& (3)t.) 5t'. is a registere' manufacturer of ice cream. 6ata regar'ing
the (usiness for the month of @ul& 2713 is gi)en as un'er: (*+
Deta8;6 Amo5nt R6.
9ale of ice cream to un.registere' persons 277"777
9ale of ice cream to consumers (inclusi)e of sales tax) 177"777
9uppl& of ice cream to college stu'ents ('uring factor& )isit) 1;"777
9ale of 'air& pro'ucts to retailers ;7"777
3urchase of milk with (ran' name 37"777
3urchase of milk without (ran' name #7"777
%ce cream fla)our importe' =7"777
3urchase of minerals from wholesaler for use in ice cream 27"777
Aou are re+uire' to calculate sales tax lia(ilit& of @amil 6air& (3)t.) 5t'. lso prepare
sales tax return of @amil 6air& (3)t.) 5t'.
"UIDELINES /OR ASSI"NMENT = &
The stu'ent shoul' look upon the assignments as a test of knowle'ge" management skills"
an' communication skills. 1hen &ou write an assignment answer" &ou are in'icating &our
knowle'ge to the teacher:
Aour le)el of un'erstan'ing of the su(4ectB
-ow clearl& &ou thinkB
-ow well &ou can reflect on &our knowle'ge C experienceB
-ow well &ou can use &our knowle'ge in sol)ing pro(lems" explaining situations"
an' 'escri(ing organi8ations an' managementB
-ow professional &ou are" an' how much care an' attention &ou gi)e to what &ou 'o.
To answer a +uestion effecti)el&" a''ress the +uestion 'irectl&" (ring important relate'
issues into the 'iscussion" refer to sources" an' in'icate how principles from the course
materials appl&. The stu'ent must also (e a(le to i'entif& important pro(lems an'
implications arising from the answer.
3
ASSI"NMENT No. *
Tota; Mar<6) &++
Pa66 Mar<6) $+
This assignment is a research.oriente' acti)it&. Aou are re+uire' to o(tain information
from a (usinessDcommercial organi8ation an' prepare a report of a(out 1777 wor's on
the topic allotte' to &ou to (e su(mitte' to &our teacher for e)aluation.
Aou are re+uire' to select one of the following topics accor'ing to the last 'igit of &our
roll num(er. $or example" if &our roll num(er is 3.3#2E1/7 then &ou will select topic F 7
(the last 'igit): .
TOPICS)
7 >xemption of agricultural income from taxation
1 3rogressi)e taxation )s. regressi)e taxation
2 *etho'" manner an' mo'e of propert& tax
3 6ifficulties in calculation an' filing of income tax returns
# 6ifficulties in calculation an' filing of sales tax returns
; 9et.off an' carr& forwar' of losses
= Tax 'e'ucte' at source
E 3rosecution an' penalties against tax offen'ers
/ 2ole of income tax authorities
? ssessment c&cle
The report shoul' follow the following format:
1. Title page
2. cknowle'gements
3. n a(stract (one page summar& of the paper)
#. Ta(le of contents
;. %ntro'uction to the issue ((rief histor& C significance of issue assigne')
=. 3ractical stu'& of the organi8ation (with respect to the issue)
E. 6ata collection metho's
/. 91OT anal&sis (strengths" weaknesses" opportunities C threats) rele)ant to the
issue assigne'
?. Conclusion (one page (rief co)ering important aspects of &our report)
17. 2ecommen'ations (specific recommen'ations rele)ant to issue assigne')
11. 2eferences (as per 3 format)
12. nnexes (if an&)
"UIDELINES /OR ASSI"NMENT = *)
$or citing references" writing (i(liographies" an' formatting the assignment" 3 format
shoul' (e followe':
1.; line spacing
,se hea'ers an' su(hea's throughout all sections
Organi8ation of i'eas
1riting skills (spelling" grammar" punctuation)
3rofessionalism (rea'a(ilit& an' general appearance)
6o more than repeat the text
>xpress a point of )iew an' 'efen' it.
#
-OR(S'OPS
The workshop presentations pro)i'e stu'ents opportunit& to express their communication
skills" knowle'ge C un'erstan'ing of concepts learne' 'uring practical stu'& assigne' in
assignment F 2.
Aou shoul' use transparencies an' an& other material for effecti)e presentation. The
transparencies are not the presentation" (ut onl& a toolB the presentation is the
com(ination of the transparencies an' &our speech. 1orkshop presentation transparencies
shoul' onl& (e in t&pe' format.
The transparencies shoul' follow the following format:
1) Title page
2) n a(stract (one page summar& of the paper)
3) %ntro'uction to the issue ((rief histor& C significance of issue assigne')
#) 3ractical stu'& of the organi8ation (with respect to the issue)
;) 6ata collection metho's
=) 91OT anal&sis (strengths" weaknesses" opportunities C threats) rele)ant to the
issue assigne'
E) Conclusion (one page (rief co)ering important aspects of &our report)
/) 2ecommen'ations (specific recommen'ations rele)ant to issue assigne')
"UIDELINES /OR PRESENTATION)
*ake e&e contact an' react to the au'ience. 6onGt rea' from the transparencies or
from report" an' 'onGt look too much at the transparencies (occasional glances are
accepta(le to help in recalling the topic to co)er).
1;.minute presentation can (e practice' se)eral times in a')ance" so 'o that until
&ou are confi'ent enough. 9ome people also use a mirror when rehearsing as a
su(stitute for an au'ience.
-EI"'TA"E O/ T'EORY > PRACTICAL ASPECTS IN ASSI"NMENT = * >
-OR(S'OP PRESENTATIONS
ssignment F 2 C workshop presentations are e)aluate' on the (asis of theor& C its
applica(ilit&. The weightage of each aspect woul' (e:
Theor&: =7H
pplica(ilit& (practical stu'& of the organi8ation): #7H
TA!ATION MANA"EMENT
COURSE OUTLINE (#$%&
Un8t?& ADVANCE TOPICS IN TA!ATION
1.1 3hilosoph& of tax
1.1.1 %slamic philosoph& of tax
1.1.2 Comparati)e stu'& of tax un'er %slam" @u'aism an' Christianit&.
1.2 3rinciples of taxation
1.3 Conse+uences of tax e)asion with respect to (usiness entit&" an' econom& as a whole
1.# $ighting with tax e)asion
1.; Tax as a tool of fiscal polic&
;
1.= Tax structure of 3akistan (merits" 'emerits)" Comparati)e stu'& with other 9outh
sian 'e)eloping
1.E Countries an' recommen'ations for impro)ement
1./ -istor& of tax reforms in 3akistan" Critical re)iew of tax reforms in 3akistan"
Comparati)e stu'& of tax reforms with other 9outh sian Countries
1.? Tax management with special focus on corporate tax
1.17 Tax re)enue management in 3akistan
1.11 Tax (ase" chargea(ilit&" an' collection
Un8t?* INCOME TA! ORDINANCE *++& @8tA Re;e:ant R5;e6
2.1 Comprehension of Basic 2ules an' Concepts
2.2 Basic principles of construction" rele)ant 'efinitionsDconcepts
2.2.1 3ersons I9ection 2(#2)J
2.2.2 %ncome I9ection 2(2?)J
2.2.3 Total income (with special 'e(ate on 'istri(ution of total income un'er
)arious hea's)
2.2.# Taxa(le income I9ection 2(=#)J
2.2.; ssessment I9ection 2(;)J
2.2.= Tax
2.2.E Taxpa&er I9ection 2(==)J
2.2./ Tax &ear I9ection 2(=/)J
2.2.? ccumulate' profit I9ection 2(1)J
2.2.17 6i)i'en' I9ection 2(1?)J
2.2.11 %n'ustrial un'ertaking
2.2.12 3ermanent esta(lishment I9ection 2(#1)J
2.2.13 ssociates
2.2.1# 2esi'ent an' non.resi'ent persons
Un8t?% Ta7 ABm8n86trat8on
3.1 Tax authorities I9ection 27EJ
3.2 Circulars" or'ers an' 'irections issue' (& the $e'eral Boar' of 2e)enue ($B2)
I9ections 27=" 213 C 21#J
3.3 ')ance rulings I9ection 27= J.
3.# ppellate 9&stem I9ections 12E to 13=J
3.; Commissioner %nlan' 2e)enue (ppeals)
3.= ppellate Tri(unal
3.E Conceptual 'iscussion regar'ing point of law an' point of fact
Un8t , Ta7 on Ta7aC;e Income (I
#.1 -ea's of income I9ection 11J
#.2 %ncome for tax purposes I9ection ? C 17J
#.3 Tax pa&a(le on taxa(le income I$irst 9che'ule to the Or'inanceJ
#.# 9alar&
#.#.1 Concept of emplo&ment" emplo&er" emplo&ee an' salar&
#.#.2 Basis of assessment
#.2.3 2esi'ential status of salarie' person
#.2.# >mplo&ee share schemes
#.2.; 3er+uisites ((enefits.in.kin')
#.2.= Taxation at source from salar&
#.2.E 2etirement (enefits (3ension" gratuit&" pro)i'ent fun')
#.2./ >mplo&ment termination (enefits
#.2.? >xemptions an' tax concessions regar'ing salar&
=
#.; %ncome from Other 9ources I9ections 3?" #7" ;;(1)" =E" /?" 171(=)" 111J
#.;.1 Concept of other sources un'er the Or'inance
#.;.2 llowa(le 'e'uctions
Un8t?$ Ta7 on Ta7aC;e Income (II
;.1 %ncome from propert&
;.1.1 Concept of propert& un'er the Or'inance
;.1.2 >lements of propert& income
;.1.3 Computation of taxa(le income an' tax pa&a(le un'er the hea' propert&
;.1.# >xemptions an' lower rate taxation of income from propert&
;.1.; *etho'" manner an' mo'e of propert& tax
;.2 %ncome from (usiness I9ections 1/ to 3=J
;.2.1 Concept of (usiness un'er the Or'inance
;.2.2 3rinciples regar'ing chargea(le income
;.2.3 <eneral principles for allowa(le 'e'uctions
;.2.; 6e'uctions allowe' I9ection 27J
;.2.# 6e'uctions not allowe' I9ection 21J
;.2.= >xemptions an' tax concessions
;.3 Capital <ains
;.3.1 Concept of Capital sset un'er the Or'inance
;.3.2 3rinciples for computing capital gains
;.3.3 6e'uction of losses
Un8t D Ta7 CreB8t6 anB M8n8m5m Ta7 ESect8on6 D& to D$ > Sect8on6 &&% to &&%BF
=.1 9et.off an' Carr& $orwar' of 5osses I3art K%%% of Chapter %%%J
=.1.1 3rinciples relating to inter.hea'.a'4ustments
=.1.2 2ules for carr&ing forwar' an' su(se+uent a'4ustments
=.2 3roce'ure I3arts % an' %% of Chapter LJ
=.3 %ncomes chargea(le as minimum tax
=.# 3ersons lia(le to pa& minimum tax
=.; ')ance Tax C $inal Tax 2egime (1ithhol'ing Tax)
=.;.1 9pecial focus on section 1=?
=.;.2 Comparati)e 'iscussion regar'ing tax 'e'ucte' at source (withhol'ing
tax) treate' as a'4usta(le" minimum or final tax.
=.= 6efault 9urcharge I3art L%% of Chapter LJ
=.E 9ales Tax ct 1??7 with 2ele)ant 2ulesD!otifications
=.E.1 O)er)iew" 9cheme an' 9cope
Un8t G CompreAen68on of Ba686, R5;e6 anB Concept6 Re;e:ant Def8n8t8on60Concept6
E.1 rears
E.2 6ue 'ate I9ection 2(?)J
E.3 >xempt suppl& I9ection 2(11)J
E.# <oo's I9ection 2(12)J
E.; *anufacturer or pro'ucer C *anufacture or pro'uce
E.= %nput tax I9ection 2(1#)J
E.E 2egistere' person I9ection 2(2;)J
E./ 9uppl& I9ection 2(33)J
E.? Tax Isection 2(3#)J
E.17 Tax %n)oice
E.11 Taxa(le acti)it& I9ection 2(3;)J
E.12 Taxa(le suppl& I9ection 2(#1)J
E.13 Mero rate' suppl&
E
E.1# Tax perio' I9ection 2(#3)J
E.1; Time of suppl& I9ection 2(##)J
Un8t # Scope anB PaHment of Ta7 ESect8on6 % to &% @8tA re;e:ant r5;e6F
/.1 9cope of chargea(ilit&" mo'e of collection etc
/.2 Mero rating
/.3 Change in the rate of tax
/.# Time an' manner of pa&ment
/.; 6etermination of tax lia(ilit&
/.= Tax cre'it not allowe'
/.E 6e(it an' cre'it note
/./ >xcess amount to (e carrie' forwar' or refun'e'
/.? ssessment of tax
/.17 9hort.pai' amounts reco)era(le without notice
/.11 >xemption
Un8t I Ret5rn6, Re986trat8on anB A5tAor8t8e6 ESect8on6 *D, *G, *# @8tA re;e:ant r5;e6F
?.1 2eturns
?.1.1 !ormal 2eturn
?.1.2 nnual return
?.1.3 9pecial 2eturn
?.1.# $inal 2eturn
?.2 2egistration (9ections 1#" 21" with rele)ant rules)
?.2.1 2e+uirement of registration
?.2.2 Compulsor& registration
?.2.3 6e.registration
?.3 uthorities (9ections 37" 37" 37B" 37C" 376" 3766" 37>" 31" 32 an' 32)
Recommended Books:
1. Text Book of Business Taxation (& %4a8 li 1aince" pu(lishe' (& 1aince
ca'em&" $aisala(a'.
2. -u8aima C %kramNs GTax 5aws of 3akistanG IOfficial )ersion can (e 'ownloa'e'
from www.f(r.go).pk
3. 3ractical -an'(ook of %ncome Tax (& 6r. %kramul -a+" pu(lishe' (& 5ahore 5aw
3u(lications email: infoOhu8aimaikram.com
1e(site: http:DDhu8aimaikram.com
Advance Readings/Source Material:
#. 9&nopsis of taxation (& *ir8a *unawar -ussain.
;. Karious articles on tax laws an' issues a)aila(le at http:DDhu8aimaikram.com
=. *aterial at official we(site (www.f(r.go).pk) of $B2.
E. 2eforms in Tax 'ministration of 3akistan" report (& 9&e' 9hahi' -ussain"
www.google.com.
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