You are here
Home > Business > Banks, Exchange Companies No More Required to Give Details of Remittances Sent Abroad for Education

Banks, Exchange Companies No More Required to Give Details of Remittances Sent Abroad for Education

FBR

Federal Board of Revenue (FBR) shall not ask banks and exchange companies to provide details of persons sending remittances abroad related to education.

Through Finance Act, 2020, the Section 236R of Income Tax Ordinance, 2001 has been omitted. This section was introduced for collection of advance tax on education related expenses remitted abroad.

This section was introduced through Finance Act 2015 under which banks, financial institutions, foreign exchange companies or any other person responsible for remitting foreign currency abroad shall collect advance tax at the rate of five percent from the payer of education related expenses.

Tax collected under the section was adjustable against the income of the person remitting payment of education related expenses.

The section defined “education related expenses” as tuition fee, boarding and lodging expenses, any payment for distant learning to any institution or university in a foreign country and any other expense related or attributable to foreign education.

This section was an important source of gathering information of those persons having taxable income in Pakistan and sending foreign exchange abroad taking advantage of education expenses.

Under Section 165 of Income Tax Ordinance, 2001, withholding agents are required to provide details of persons including CNIC, NTN and addresses, whose tax was deducted at the time of transaction.

However, deletion of this section the banks and exchange companies would no more required to share details of persons who are sending foreign exchange abroad for education related expenses.

Leave a Reply

Top