SATURDAY APRIL 02: Commission liable to 10 percent WHT: FBR
The Federal Board of Revenue on Friday announced that brokerage/commission earned in five zero-rated sectors - textile, leather, surgical, sports and carpets would be liable to 10 percent withholding tax which would be final discharge of tax liability. In this connection, the FBR issued a circular number 3 of 2011 here on Friday to clarify the deduction of withholding tax on commission payments made by sales tax zero-rated categories of taxpayers.
Copyright Business Recorder, 2011
According to the FBR, it is clarified that under the provisions of section 233 of the Income tax ordinance, 2001, withholding tax is deductible @ 10 percent on payments made on account of brokerage commission, in the following categories of taxpayers falling under the zero-rating regime of sales tax including carpets; leather and articles thereof including artificial leather footwear; surgical goods; sports goods and textile and articles thereof. It is clarified that as provided under sub-section (3) of section 233 of the Income Tax Ordinance, 2001 tax collected shall be final tax on the income from brokerage/commission of such person, the FBR added.