Income Tax Ordinance, 2001

CHAPTER-III

TAX ON TAXABLE INCOME PART IV HEAD OF INCOME: INCOME FROM BUSINESS Division II Deductions: General Principles

From: 2023-07-01 - To: 0000-00-00 20. Deductions in computing income chargeable under the head “Income from Business”.- (1) Subject to this Ordinance, in computing the income of a person chargeable to tax under the head “Income from Business” for a tax year, a deduction shall be allowed for any expenditure incurred by the person in the year 1[wholly and exclusively for the purposes of business]. 2(1A) Subject to this Ordinance, where animals which have been used for the purposes of the business or profession otherwise than as stock-in-trade and have died or become permanently useless for such purposes 3[a deduction shall be allowed equal to], the difference between the actual cost to the taxpayer of the animals and the amount, if any, realized in respect of the carcasses or animals.] (2) Subject to this Ordinance, where the expenditure referred to in sub-section (1) is incurred in acquiring a depreciable asset or an intangible with a useful life of more than one year or is pre-commencement expenditure, the person must depreciate or amortize the expenditure in accordance with sections 22, 23, 24 and 25. 4[(3) Subject to this Ordinance, where any expenditure is incurred by an amalgamated company on legal and financial advisory services and other administrative cost relating to planning and implementation of amalgamation, a deduction shall be allowed for such expenditure.] _____________________________________________________________ 1-Substituted for the words “to the extent the expenditure is incurred in deriving income from business chargeable to tax” vide the Finance Act, 2004 (II of 2004 assented on 30th June, 2004) 2-Inserted vide the Finance Act, 2009 (I of 2009 assented on 30th June, 2009) 3-Words added by Finance Act, 2021, dated 30-06-2021 4-Added vide the Finance Ordinance, 2002 (XXVII of 2002 promulgated on 15th June, 2002) From: 2021-07-01 - To: 2023-06-30 20. Deductions in computing income chargeable under the head “Income from Business”.- (1) Subject to this Ordinance, in computing the income of a person chargeable to tax under the head “Income from Business” for a tax year, a deduction shall be allowed for any expenditure incurred by the person in…