- June 1, 2023
- Posted by: Muhammad Shehzad
- Category: RBS News
In the upcoming budget for 2023–2024, the federal government might change the legislation relating to changing non-resident Pakistanis’ tax residency. The initiative ‘Govt mulls amending laws on NRPs and changing tax residency status’ is admirable.
Navigating Taxes in Pakistan: Insights for Individual Residents
The individual residents of Pakistan are subject to the Capital Value Tax and income tax. This is under the under Section 7E of the Income Tax Ordinance, 2001. Pakistan considers an individual a resident if they spend 183 days or more in the country during a tax year. It is according to ‘Section 82 of the Ordinance. Moreover, they are a Pakistani citizen who doesn’t spend more than 180 days in any other country during the tax year. Also, they are Pakistani if they are not a resident of any other country.
Hawks Melbourne City Rawalpindi is an ideally located society providing premium amenities.
Addressing Tax Residency Challenges: Enhancing Regulations for Non-Resident Pakistanis
As per the news source, it has come to light that some taxpayers are altering their tax residency status by residing in another country for over six months. In light of this, it is said to implement appropriate tax modifications for non-resident Pakistanis. It will be effective from the tax year 2023-24. Further, the proposed amendment specifies that assets owned by such individuals will be considered disposed of in the year when they become non-residents. This is a good initiative by Federal Government.
Further , the difference between the fair value of the assets at the end of the year in which the person becomes a non-resident and the original cost of the assets with the individual will be used to compute the tax due on capital gains for the deemed disposal. Tax changes in Section 75, regarding the disposal and acquisition of assets, are obligatory for non-resident Pakistanis.
For further updates on ‘Govt mulls amending laws on NRPs and changing tax residency status’, keep visiting Royal Business Solutions.