Any person who wishes to plan a gathering, a marriage or any sort of social function in a lawn or a hall is now bound to pay an advance tax of 5% of the total they paid as rent for the premises in Karachi.
This has been notified by the Federal Board of Revenue (FBR) as part of the recently issued Withholding Tax Card 2017/2018.
About Withholding Tax Card 2017/2018
Under Section 236D (1) of the Income Tax Ordinance, 2001, the Withholding Tax Card 2017/2018 issued by the FBR requires five percent advance tax on functions and gatherings.
The agents responsible for collecting the payment may collect the advance tax from the person arranging or holding the event in any of the following places:
- Marriage hall
- Commercial lawn
- Community place
It should be mentioned here that as per FBR’s rules, the tax needs to be collected at the time when an individual pays the bill for booking a venue. The tax is applicable at any of the above places which are booked for the purpose of holding a function.
Tax On Food And Other Services
If that wasn’t enough, Section 236D (2) of the Income Tax Ordinance states that witholding agents are also required to collect a 5% tax on food services.
Furthermore, this tax is also applicable on any other services that are availed by the event organizers.
However the advance tax in both the cases is adjustable against the total liability of a taxpayer.