All the four provinces of Pakistan have launched and are successfully running their websites to process and list the required motor vehicle charges. Registered owners of commercial and private vehicles can easily find out what motor vehicle taxes and other related charges like title transfer and initial registration need to be paid. The online payment processing is active for Sind, Punjab, and Islamabad Capital territory, while those for KPK and Balochistan are still under process.

Links for the details of the provincial revenue authority websites are as follows:

1.    Punjab

Managed by the Excise, Taxation & Narcotics Control Department, Government of Punjab.

Web page: https://excise.punjab.gov.pk/motorvehicle_tax

2.    Sind

Managed by the Excise, Taxation, and Narcotics Control Department, Government of Sind.

Web page:  https://excise.gos.pk/taxes/motor-vehicle-tax/

3.    Balochistan

Managed by the Balochistan Revenue Authority, Government of Balochistan.

Web page:  https://bra.gob.pk/HowtopayTaxes.aspx

4.    Khyber Pakhtunkhwa

Managed by the Excise, Taxation, and Narcotics Control Department, Government of Khyber Pakhtunkhwa

Web page: http://www.kpexcise.gov.pk/app/motor-vehicle-taxes/

Sind, Punjab, and Khyber Pakhtunkhwa have actively running websites with support and clear links out of the four websites listed. The Balochistan Revenue Authority is also aiming to digitize all its relevant revenue departments, with a particular focus on the online payment of taxes. It will facilitate ease of doing business in Baluchistan. However, all four sites had clear guides on how to go about paying vehicles taxes online.

A summary of the process is given below, there may be some differences, but the general process is the same for all provinces.

How to Pay Vehicles Token Online?

The links of the provinces’ motor vehicle tax pages open on a schedule of charges for vehicles. Suppose you want to transfer ownership, pay annual taxes, or register a new vehicle. In that case, tables are listed specifying the costs according to vehicle category and its engine capacity (its listed cc).

Make sure you have the details like your car’s last paid tax, registration year, and other relevant information. The tax calculator will help you calculate how much you need to pay.

The payment processing can be done directly, while some provinces require that you download their revenue processing applications from Play Store (Android) or App Store (Apple). Make an ID and profile and create an account to pay whatever official dues you need to pay.

To pay motor vehicle taxes Online in Punjab, you need to:

Download the Punjab ePay App. The Punjab IT Board develops this app under the instructions of the Finance Department of Punjab to facilitate people in paying vehicle tax online as well as multiple ranges of services.

How to pay vehicle token tax online in Punjab?

• Install the e-Pay Punjab application from Google Play Store or Apple App Store.
• Create an account to get started.
• Select Token Tax under the Excise and Taxation Department tab.
• Enter vehicle registration number (e.g. LEA-123 or LEA-20-123).
• After confirming details, generate a challan.
• Note down the PISD number provided to pay token tax online

To pay motor vehicle taxes in Sind, you need to:

1: Open the relevant provincial excise department’s website and click on “Online Tax Payment.”

2: After clicking on Online Tax Payment,” a tab will open where you should select “Quick Pay.”

3: Enter your mobile number and car registration number on the Quick Pay tab.

4: Click on the calculate tax button to see how much tax you owe.

5: Now select ‘Generate PSID’ and copy down the PSID generated.

This PSID is used to process and track your payment through the option you decide.

Payment Options

These are the same for all provinces, once the PSID has been generated

1. Through an ATM

Visit your nearest ATM along with your ATM Card.

– After PIN verification, select the option of ‘Tax Payment’ under the choice of bill payment and select Excise and Taxation from the main menu.

– Enter the numbers of the PSID you were issued and Press OK.

– the amount due against the PSID number should be automatically fetched and displayed on the ATM Screen.

2. Net banking

Log in to your internet or mobile banking app and select the option of ‘Tax Payment.’ This should be under the option of ‘Bill Payment’ and select ‘Excise & Taxation’ from the main menu.

Enter the digits of your PSID and Press OK. Again, the payable amount against the PSID number you generated should automatically be fetched and displayed on your screen. Transfer funds and you will get a message about the transaction being successful on the screen. (take a screenshot for safekeeping)

3. Bank branches

You can also visit the nearest 1Link Member bank branches with a printout of the PSID number and ask the cashier to make the payment of due taxes against the PSID.

Payment of Online Vehicle Tax in Islamabad Capital Territory

People in Islamabad can now avail themselves of the option of paying vehicle tax online through using the Islamabad City App without needing to visit the Excise and Taxation Department physically.

The Islamabad City App is a project of the National IT Board. Apart from providing the facility to pay vehicle taxes online, citizens of the capital territory have a range of other options available for their convenience.

Some of the facilities offered by the Islamabad City App are

• Domicile Certificate
• International Driving Permit
• Token Tax Payment
• Vehicle Registration

Apart from these services, citizens can also verify all issued certificates and registrations already done.

How to pay Vehicle Tax Online using Islamabad City App?

1. Install the app from Google Play Store through the link: play.google.com/store/apps/IslamabadCityApp
2. Register using your CNIC and your email ID.
3. Click Token Tax Tab.
4. Enter your vehicle number.
5. Pay your token Tax Online.

Sadia Zaheer

Sadia Zaheer holds a Masters in Business Administration from IBA, Karachi. After working in several financial institutions in Client Management, Corporate Lending, Islamic Banking and Product Management she jumped careers to pursue a career in writing.
She is a Finance, Business and HR Development writer with four years of experience. She reads a lot and takes care of her multiple cats to remain calm.

The post The easiest way to pay vehicle tax in Pakistan appeared first on Smartchoice.pk.

Key Terms to Understand

Let us begin by revisiting a few basic definitions:

Taxable Income

This is the Total Income minus exemptions and any donations that are eligible for deduction from taxation and deductible allowances.

Exemptions:

Exemptions are income heads that are tax-free, therefore “exempt” from taxes.

Total Income

Total Income is the total of all income that is subject to Taxes under each head of Income.

Head of Income

Under the Income Tax Ordinance, 2001, Income is classified into the following five heads of Income:

1. Salary
2. Income from property
3. Income from business
4. Capital gains
5. Income from Other Sources

Resident

A taxpayer is considered a resident (and therefore has to pay taxes) under the following conditions:

• S/he has been living in Pakistan for a period or periods that add up to at least one hundred and eighty-three days (183 days) or more in the tax year;
• If a person individual is in Pakistan for a period or periods that add up to one hundred and twenty days (120) or more in the tax year AND, in the four years before the current tax year, has been in Pakistan for a period or periods that add up to three hundred and sixty-five days or more;
• Is an employee or official of the Federal Government or a Provincial Government posted abroad in the Tax Year?
• An Association of Persons is Resident for a Tax Year if the control and management of its affairs was wholly or partly in Pakistan for any time in that year;
• A Company is treated as a Resident for a Tax Year if :
  • It is incorporated or formed under any law in force in Pakistan;
  • The control and management of its affairs is wholly in Pakistan for any time in the year; or
  • It is a Provincial Government or a local government in Pakistan.

Non-Resident

An Association of Persons, a Company, or an Individual is considered Non-Resident for a Tax Year if they are not Resident for that year. (see requirements for Residents above)

Pakistan Source Income

Source incomes are defined in section 101 of the Income Tax Ordinance, 2001. This divides Incomes under varied heads and situations. Some of the common source Incomes are:

• Salary received or receivable from any employment in Pakistan. It doesn’t matter where it is paid.
• Salary paid by, or on behalf of, the Federal Government, a Provincial Government, or a local Government in Pakistan, regardless of where the employment (job) is
• Dividend paid by Pakistan Resident Company.
• Profit on debt paid by a Pakistani Resident Person
• Property or rental Income from the lease of immovable property in Pakistan.
• Pension or annuity paid or payable by a Resident or permanent establishment of a Non-Resident.

Foreign Source Income

Any income which is not a Pakistan source income.

Person

• Any Individual
• A Company or Association of Persons incorporated, formed, organized, or established in Pakistan or elsewhere;
• The Federal Government, a foreign government, a political subdivision of a foreign government, or public international organization

Company

• A Company is defined under the Companies Ordinance, 1984 (XLVII of 1984).
• A ‘body corporate’ formed under any law in force in Pakistan.
• A modaraba.
• A body incorporated by or under the law of a country outside Pakistan relating to the incorporation of Companies;
• An amendment has been made through the Finance Act, 2013 to enlarge the scope of the definition of a Company. Now as per Income Tax Ordinance, 2001 a company includes:
  • A co-operative society, a finance society, or any other society;
  • A non-profit organization;
  • A trust, an entity, or a body of persons established or constituted by or under any law for the time being in force.
• A foreign association, which the Board has, by general or special order, declared to be a company for this Ordinance.
• A Provincial Government.
• A Local Government in Pakistan.
• A Small Company.

Association Of Persons

• Includes a firm (the relation between persons who have agreed to share the profits of a business carried on by all or any of them acting for all).
• A Hindu undivided family
• Any artificial juridical person
• Any body of persons formed under a foreign law but does not include a Company.

Tax Year

• These twelve months that ends on the 30th day of June i.e. on the financial year
• It is mentioned by the calendar year in which the date falls. For example, the tax year for the period of twelve months from July 01, 2017, to June 30, 2018, will be mentioned as the calendar year 2018 and the period of twelve months from July 01, 2018, to June 30, 2019, shall be denoted by the calendar year 2019.

Special Tax Year

This means any period of twelve months and is denoted by the calendar year relevant to the Normal Tax Year in which the closing date of the Special Tax Year falls. For example, the Tax Year for the period of twelve months from January 01, 2017, to December 31, 2017, shall be denoted by the calendar year 2018 and the period of twelve months from October 01, 2017, to September 30, 2018, shall be denoted by the calendar year 2019.

How to Register for Taxes

Any person, a company, or an association of persons (AOP), or foreign national is treated as registered when they are re-enrolled on the Iris portal. The enrollment provides you with a National Tax Number (NTN) or Registration Number and password.

• In the case of individuals, 13 digits Computerized National Identity Card (CNIC) will be used as NTN or Registration Number.

• NTN or Registration Number for AOP and Company is the 7 digits NTN received after e-enrollment.

Both these credentials allow users to access the Iris portal, the online Income Tax system. This is the only way through which online Income Tax Returns can be filed.

Documents needed for e-enrollment for an individual are as follows:

• CNIC/NICOP/Passport number
• Cell phone number in use
• Active e-mail address
• Nationality
• Residential address
• Accounting period

In case you are paying tax on business income you will also need:

• Business name
• Business address
• Principal business activity
• Name and NTN of the employer in case of salary income
• Address of property in case of property income

The principal officer of the company and AOP needs to ensure that the following information is available before starting e-enrollment

• Name of company or AOP
• Business name
• Business address
• Accounting period
• Business phone number
• E-mail address
• Cell phone number of the principal officer of the company or AOP
• Principal business activity
• Address of industrial establishment or principal place of business
• Company type, like public limited, private limited, unit trust, trust, NGO, society, small company, modaraba, or any other
• Date of registration
• Incorporation certificate by Securities and Exchange Commission of Pakistan (SECP) in case of a company
• Registration certificate and partnership deed in case of a registered firm
• Partnership deed in case firm is not registered
• Trust deed in case of a trust
• Registration certificate in case of society
• Name of the representative with his CNIC or NTN
• Following particulars of every director and major shareholder having 10% or more shares in case of company or partners in case of an AOP, namely:-
• Name
• CNIC/NTN/Passport and
• Share %

Income tax rates for Individual and AOP

The Income-tax rates of tax applied on the taxable income of every individual and AOP are in the following table:

Rate of Tax for Salaried Individual

You know your taxable income from the tables above and you deduct the deductable allowances from the income figure.

Confused? See the example below:

In case this example is of a salaried individual, there would be no tax due as their taxable income slabs start from an annual income of Rs. 600,000. In the case of self-employed or AOPs the tax would be applied as below:

Sadia Zaheer

Sadia Zaheer holds a Masters in Business Administration from IBA, Karachi. After working in several financial institutions in Client Management, Corporate Lending, Islamic Banking and Product Management she jumped careers to pursue a career in writing.
She is a Finance, Business and HR Development writer with four years of experience. She reads a lot and takes care of her multiple cats to remain calm.

The post A Guide To Personal Taxes In Pakistan appeared first on Smartchoice.pk.