Taxation on Salary
  • For the company staff, the employer has to deduct at source deduct the income tax from the monthly salaries of the staff who get the income above 4.8 million in a year.
  • It can be calculated in the head “Salary” under the “Taxability” of “Individual”.
  • (How to forecast the tax due is available in the Tax Calculator Link.)
  • The tax must be deducted at source by the employer at the time of payment.
  • So as to withhold so, the advanced tax will have to be forecasted and deducted in installing from the income of the whole year in accordance with the sample calculation.
  • The form of monthly report is IRD (IT) – 15.
  • Company manager shall file the annual salary (employment’s income) return in the form (Patakha (wanga) -16) within three months after the end of Income Year.
  • The monthly payment and filing of return of the employment income have to be undertaken at the relevant Township Revenue Department.

             Forms are available in the forms & publications link.

Withholding Tax

In accordance with Notification 47/2018, there is no necessity to withhold tax at the time of making payment for resident citizens and resident foreigner by a company through contracts as inland purchasing of good, performing operations and providing services. However, payment to non-resident foreigners, 2.5% shall be withheld.

Import and Export of Goods

A company performing the process of export and import in such a way of border-trade and regular trade shall be obliged to pay the commercial tax, the specific good tax and the advanced income tax with custom duties at the time of importing and exporting. A company being assessed in Self-Assessment System does not need to pay the advanced income tax on export.