Exemption to Members in Case of Exempt Income of AOP
Exemption to Members in Case of Exempt Income of AOP: The Finance Act, 2022 has brought about certain amendments in the Income Tax Ordinance, 2001 (the Ordinance, hereafter). Some significant amendments on Exemption to Members in Case of Exempt Income of Firm/ Association of Persons are explained hereunder: –
Under present legal dispensation, income of an AOP is taxed and the share income received by the partners is exempt.
Where the income of AOP is exempt, the share income of partners is also exempt. In order to remove any ambiguity, an explanation has been inserted in section 92 of the Ordinance to the effect that if income of AOP is exempt then the share income of its partners shall also be exempt.
For more information on FBR’s new regulations / circulars/ SROs/ amendments in taxation laws in Pakistan please visit https://www.fbr.gov.pk/