ISLAMABAD: Federal Board of Revenue (FBR) directed the Large Taxpayer Unit II and Corporate Regional Tax Office Karachi, Rawalpindi, Sukkur, Hydarabad and Quetta Regional Tax offices to recover amount of Rs7,357.74 million from 13 taxpayers.
According to a report, six field formations of FBR assessed 13 taxpayers at loss. These losses were either assessed incorrectly or carried forward erroneously and set off against business income beyond the prescribed limit. This resulted in non-levy of tax amounting to Rs7357.74 million.
Among 13 taxpayers one company M/s IC Semiconductors Private Ltd NTN (1413317-2), filed return and declared net loss of Rs66.933 million despite the fact that taxpayer did not commence any business.
The assessed losses were carried forward and set off against the income of the subsequent income year. This loss comprised of total expenses which were to be amortized on a straight line basis as no business operation income was declared in the return and only bank profit of Rs43,595 was shown. This resulted in loss of revenue amounting to Rs23.43 million.
It is important to mention here that Section 57 of the Income Tax Ordinance, 2001 provides that if a taxpayer sustains a loss in business for a tax year, the loss would be carried forward to the six following tax years and would be adjusted only against profit and gains of such business.
