Saturday , September 21 2019

FBR Asset Declaration Ordinance 2019 Procedure & Conditions

The Federal Board of Revenue (FBR) has issued the declaration form under Asset Declaration Ordinance 2019 for persons availing the Assets Declaration Scheme. According to the Declaration issued under Asset Declaration Ordinance 2019, the person availing the scheme would declare.

The Government has announced the Assets Declaration Ordinance-2019 to provide an opportunity to the general public to regularize both domestic and foreign assets/expenditures. Asset Declaration Ordinance-2019 has made it simple and easy to declare undisclosed domestic and foreign assets/ Benaami properties. Grab this opportunity and make your assets documented. Become a beneficiary before the last date i.e. 30th June 2019.

The Declaration, available on the IRIS FBR’s online portal, also specifies domestic assets, owned assets, Benami assets, foreign assets, undisclosed -expenditures, undisclosed sales, and payment of tax demanded and tax payable. The declaration also included a description of the asset along with the proposed tax rates, cost of acquisition, fair market value, and tax in Pak rupee.

Asset Declaration Ordinance-2019

procedure

  1. a) Method of conversion of the value of assets held outside Pakistan in Pak Rupees.
  2. b) Deposit of tax in foreign currency through State Bank of Pakistan; and
  3. c) Repatriation of assets to Pakistan.
  4. Short title and commencement:
  5. The Procedure may be called the Procedure under section (9) of the Ordinance, and It shall be deemed to have come into force from the 25th day of May 2019.

Method of conversion of the value of foreign denominated assets into Pak Rupees:

The asset held outside Pakistan and foreign currency held in Pakistan shall be converted into PKR at such exchange rates1 as may be notified on daily basis by the SBP to Federal Board of Revenue (FBR) through dedicated email in respect of ten currencies i.e. AED, AUD, CAD, CHF, CNY, EUR, GBP, JPY, SAR, and USD.

  1. If the foreign currency denominated assets are in a currency other than those specified in clause 3(i), the taxpayer shall convert the said currency into PKR by using the following formula:

Value of assets in PKR = A x B x C / D where,

A = Value of asset in currency other than currencies listed in 3(i) held outside Pakistan;

1 The arithmetic means of Weighted Average Customer Exchange Rates (Buying & Selling).

B = Number of USD per SDR to be taken from IMF website2;

C = Exchange Rate of USD with PKR as notified by the SBP under clause 3(i);

and

D = Number of currency units in the currency other than those listed in 3(i) per

SDR

Illustration: The taxpayer has assets in Singapore Dollar amounting to 1,000 and files the declaration on May 16, 2019. The rates from the IMF Website of the preceding working day would be available and applicable for conversion. Hence, the parties of USD, Singapore Dollar with SDR as of May 15, 2019, are 1.382330 and 1.891160

respectively.

Value of asset in PKR =

1,000 ūĚĎ• 1.382330 ūĚĎ• 141.3445

1.891160

= PKR. 102,881.94

  1. Declaration of foreign assets held outside Pakistan and deposit of tax thereon:
  2. The taxpayer shall declare the value of his/her assets held outside Pakistan on the FBR Web Portal in respective foreign currency and equivalent PKR computed as per the procedure is given in clause 3.
  1. The system will generate tax liability of the taxpayer in PKR by applying the

the relevant tax rate for each category of disclosed assets.

iii. The taxpayer will now visit the website: https://e.fbr.gov.pk to generate the PSID. The taxpayer has the option of discharging his/her liability either in USD or AED. After the selection of tax payment currency, the system will compute the tax liability in both PKR and USD/AED. The sequential number of PSID (PSID

Number) will be recorded by the taxpayer in his/her own record, besides taking the print thereof.

2 Special Drawing Rights (SDR) rates (Currency Units per SDR) accessible from

https://www.imf.org/external/np/fin/data/param_rms_mth.aspx

  1. Payment of tax:
  2. Payment of tax in US Dollars:
  3. After completing the declaration of assets and generation of PSID as described in clause 4, the tax liability as determined in the PSID shall be remitted by wire transfer to the following account:

Beneficiary’s Correspondent Bank: NATIONAL BANK OF PAKISTAN

Beneficiary’s Bank Address: NEW YORK, U.S.A

Beneficiary’s Bank SWIFT Code: NBPAUS33

Beneficiary’s Account Title: SBP-NBP HO Collection Account

Beneficiary Customer’s Account No: 5640-5090

Payment Instructions: TRANSFER TO SBP COLLECTION

A/C WITH NBP-KO Taxpayer shall in the SWIFT message, bearing the necessary instructions above shall also include his/her PSID No, CNIC, Date of Birth (DOB), and Place of Birth (POB).

  1. The amount so received by NBP New York shall be credited to SBP-NBP HO account maintained with them.
  1. NBP-Karachi shall, after verifying receipt of the money in the above account and necessary screening, access the taxpayer’s detail from the FBR Portal by entering the PSID number as given in the SWIFT message. Thereafter, the concerned officer shall input the amount so received in the designated field. The system will match the amount received with the amount of PSID; E-CPR will be generated if the amount received in USD matches with the PSID amount in USD. In case of short payment, the system will generate SMS/ email for the taxpayers regarding the short payment. The short payment of up to USD. 100 can be deposited in cash with the designated NBP branches in major cities. In order to avoid the hassle; the taxpayer may consider remitting USD 50 over and above the tax liability so as to absorb correspondent bank charges. The excess amount, if any, shall be credited to a temporary account to be closed after the culmination of the scheme.
  1. NBP ‚Äď Karachi will settle the foreign currency proceeds of the issued eCPRs into the Nostro account of SBP with NBP New York on a T+1 basis.
  1. NBP- Karachi will render a summary of the settlement of eCPRs in respect of which the settlement has been made in SBP Nostro Account. The summary inter-alia shall include the tax liability in PKR and USD as per eCPRs.
  1. SBP will credit the government account with the amount of PKR as accumulated through eCPRs and consequential exchange rate differential shall be on SBP account.
  1. Payment of tax in UAE Dirham:
  2. a) After completing the declaration of assets and generation of PSID as described in Para ‚Äė4‚Äô above, the taxpayer shall arrange to remit the AED funds against the

tax liability as reflected in the PSID to SBP through official normal banking channels in the following account:

Beneficiary’s Correspondent Bank: MASHREQ BANK DUBAI

Receiving Bank Address: DUBAI, UAE

Receiving Bank SWIFT Code: BOMLAEAD

Beneficiary Customer’s Account Title National Bank of Pakistan Head office Karachi

Beneficiary Customer’s Account No: 19030000173

Payment Instructions: TRANSFER TO SBP COLLECTION

A/C WITH NBP-KO Taxpayer shall in the SWIFT message, bearing the necessary instructions above shall also include his/her PSID No, CNIC, Date of Birth (DOB), and Place of Birth (POB).

  1. The amount so received by Mashreq Bank Dubai will be credited to the National Bank of Pakistan Head office Karachi (NBP Karachi) account maintained with them.
  1. NBP-Karachi will, after verifying receipt of the money in its account and necessary screening, access the taxpayer’s detail from the FBR Portal by entering the PSID number as given in the SWIFT message. Thereafter, the concerned officer shall input the amount so received in the designated field.

The system will match the amount received with the amount of PSID; E-CPR will be generated if the amount received in AED matches with the PSID amount in AED. In case of short payment, the system will generate SMS/ email for the taxpayers regarding the short payment. The short payment of an equivalent to up to USD. 100 can be deposited in cash with the designated NBP branches in major cities. In order to avoid the hassle; the taxpayer may consider remitting AED 200 over and above the tax liability so as to absorb correspondent bank charges. The excess amount, if any, shall be credited to a temporary account to be closed after the culmination of the scheme.

  1. NBP ‚Äď Karachi will settle the foreign proceeds into the Nostro account of SBP with First Abu Dhabi Bank ‚Äď Abu Dhabi on a T+1 basis.
  1. NBP- Karachi will render a summary of a settlement of eCPRs in respect of which the settlement has been made in SBP Nostro Account. The summary shall inter-alia include the tax liability in PKR and AED as per eCPRs.
  1. SBP will credit the government account with the amount of PKR as accumulated through eCPRs and consequential exchange rate differential shall be on SBP account.
  1. Payment of tax on foreign currency held in Pakistan:
  2. The following assets shall be included in the foreign currency held in Pakistan:

Cash held by the declarant which is deposited into a bank account in the manner prescribed by section 8(a) of the Ordinance;

Foreign Currency held in declarants own foreign currency bank account and retained in the said account in accordance with the provisions of Section 8(b), and Face Value of the amount invested in Pakistan Banao Certificates (PBCs).

  1. The aforesaid assets shall be converted into Pak Rupee in accordance with the procedure given in Clause 3 above. The PKR value so computed shall be declared on FBR Web Portal along with Bank Name, Branch name, and account number.

iii. The taxpayer will then generate a PSID in PKR and USD through https://paysys.fbr.gov.pk; the sequential number (PSID Number) of which will be recorded by the taxpayer in his/her own record, besides taking the print thereof.

  1. The payment of such tax shall be made locally through local USD Clearing accounts of the bank maintained with the State Bank of Pakistan for which purpose the taxpayer shall advise their banker to issue a debit authority in favor of Chief Manager SBPBSC-KO, authorizing to debit the account to the tune of the tax liability. The debit authority must specify the PSID of the taxpayer, so as to enable the generation of CPR.
  1. Payment of tax after 30th June 2019:
  2. A taxpayer declaring his/her assets held outside Pakistan and/ or foreign currency held in Pakistan, shall file his/ her declaration at FBR Portal and generate PSID indicating tax liability in Pak Rupee and foreign currency (either in USD or AED), on or before 30th June 2019.
  1. The tax liability in foreign currency as reflected in the aforesaid PSID shall be the amount on which surcharge at the applicable rate will be levied, if the taxpayer discharges his/ her liability after 30th June 2019. The PSID for payment of default surcharge will be created at the time of payment of the tax and the surcharge.
  1. Repatriation of assets to Pakistan:
  2. Taxpayers intending to repatriate their assets held outside Pakistan shall remit the same to Pakistan through banking channels in declarants’ own account, whether denominated in PKR of FCY in any bank in Pakistan.
  1. Taxpayers may also repatriate their liquid assets by subscribing Pakistan Banao Certificates (PBCs) digitally through the web portal at https://pakistanbanaocertificates.gov.pk.

iii. The Pakistani bank receiving the repatriated funds shall issue Asset Repatriation Certificate (ARC) which shall include the details such as Name of Remitter, Amount in FCY, and IBAN of the taxpayer. Each ARC shall have a unique reference number, which the taxpayer shall use to report the same to

FBR. The taxpayer shall also upload the ARC on the FBR Web-Portal.

  1. The bank shall issue ARC under these rules only in respect of the assets repatriated on or after the date of issuance of the Ordinance.
  1. SBP may either as a part of its regular inspection or through a special inspection may examine the record of all such certificates issued by the bank so as to confirm their accuracy and conformity with the underlying record and transaction trail.
  1. Removal of Difficulties:
  2. SBP may issue notifications/ circulars/ FAQs for the removal of any difficulties in the payment/ remittance process from time to time.

non-filers have received serious attention from the people of Pakistan, now every person dealing with the bank whether salaried class, businessman or even a housewife is faced with the issue of being filer or non-filer.