Income Tax Ordinance, 2001

CHAPTER-III

TAX ON TAXABLE INCOME PART VII EXEMPTIONS AND TAX CONCESSIONS

Income Tax Ordinance, 2001 CHAPTER-III TAX ON TAXABLE INCOME PART VII EXEMPTIONS AND TAX CONCESSIONS From: 2024-12-29 - To: 0000-00-00 1[59B. Group relief.- (1) Subject to sub-section (2), any company, being a subsidiary 2[or] a holding company, may surrender its assessed loss 3[as computed in sub-section (1A)] (excluding capital loss) for the tax year (other than brought forward losses and capital losses), in favour of its holding company or its subsidiary or between another subsidiary of the holding company: Provided that where one of the company in the group is a public company listed on a registered stock exchange in Pakistan, the holding company shall directly hold fifty-five per cent or more of the share capital of the subsidiary company. Where none of the companies in the group is a listed company, the holding company shall hold directly seventy-five per cent or more of the share capital of the subsidiary company. 4[(1A) The loss to be surrendered under sub-section (1) shall be allowed as per following formula, namely:- (A/100) x B where- A is the percentage share capital held by the holding company of its subsidiary company; and B is the assessed loss of the subsidiary company.] (2) The loss surrendered by the subsidiary company may be claimed by the holding company or a subsidiary company for set off against its income under the head “Income from Business” in the tax year and the following two tax years subject to the following conditions, namely:- (a) there is continued ownership for five years, of share capital of the subsidiary company to the extent of fifty-five per cent in the case of a listed company, or seventy-five per cent or more, in the case of other companies; (b) a company within the group engaged in the business of trading shall not be entitled to avail group relief; (c) holding company, being a private limited company with seventy-five per cent of ownership of share capital gets itself listed within three years from the year in which loss is claimed; (d) the group companies are locally incorporated companies under the 5[Companies Act, 2017 (XIX of 2017)]. (e) the loss surrendered and loss claimed under this section shall have approval of…