Income Tax Ordinance, 2001

CHAPTER-VII

INTERNATIONAL PART I GEOGRAPHICAL SOURCE OF INCOME

Income Tax Ordinance, 2001 CHAPTER-VII INTERNATIONAL PART I GEOGRAPHICAL SOURCE OF INCOME From: 2024-07-01 - To: 0000-00-00 1[101A. Gain on disposal of assets outside Pakistan.- (1) Any gain from the disposal or alienation outside Pakistan of an asset located in Pakistan of a non-resident company shall be Pakistan-source. (2) The gain under sub-section (1) shall be chargeable to tax at the rate and in the manner as specified in sub-section (10). (3) Where the asset is any share or interest in a non-resident company, the asset shall be treated to be located in Pakistan, if- (a) the share or interest derives, directly or indirectly, its value wholly or principally from the assets located in Pakistan; and (b) shares or interest representing ten per cent or more of the share capital of the non-resident company are disposed or alienated. (4) The share or interest, as mentioned in sub-section (3), shall be treated to derive its value principally from the assets located in Pakistan, if on the last day of the tax year preceding the date of transfer of a share or an interest, the value of such assets exceeds one hundred million Rupees and represents at least fifty per cent of the value of all the assets owned by the non-resident company. (5) Notwithstanding the provisions of section 68, the value as mentioned in sub-section (4) shall be the fair market value, as may be prescribed, for the purpose of this section without reduction of liabilities. (6) Where the entire assets by the non-resident company are not located in Pakistan, the income of the non-resident company, from disposal or alienation outside Pakistan of a share of, or interest in, such non-resident company shall be treated to be located in Pakistan, to the extent it is reasonably attributable to assets located in Pakistan and determined as may be prescribed. (7) Where the asset of a non-resident company derives, directly or indirectly, its value wholly or principally from the assets located in Pakistan and the non-resident company holds, directly or indirectly, such assets through a resident company, such resident company shall, for the purposes of determination of gain and tax thereon under sub-section (8)…