ASSESSMENT PROCEDURE: ILLUSTRATION 4

Mr. Abdul Salam executed a contract of construction of a building with University of the Punjab of rupees ten million. What amount of tax should be deducted by the University from the payment if:

(i) the has provided his NTN to the University.

(ii) he fails to provide either NTN or CNIC.

Solution

(1) The deduction required on execution of a contract is @ 6%, which comes to Rs. 6,00,000, in both the cases.

(ii) The amount should be deposited by the University of Dfa Ho with the Government of Pakistan.

(iii) This will be final payment of tax for the person regarding the contract. He will not have to pay any further amount on the profits earned by him on this contract.