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Sunday, 10 March 2013

Define the following terms in the income tax ordinance Association of persons, Banking company, Business







ASSOCIATION OF PERSONS :-
Following are included in the association of persons.
  1. firm
  2. Any artificial person
  3. Any body of persons formed under a foreign law.




BANKING COMPANY :-
Income tax ordinance and banking companies ordinance consider the same meanings of “Banking Company”.

Main Features :
  1. A company which is formed under the banking companies ordinance.
  2. A company which transacts the business in their own country.
  3. It includes any body corporate and formed under his country law.



BUSINESS :-
According to income tax ordinance following terms are included in the business :

  1. Trade :-
Any activity between the buyers and sellers of goods earn profit is also called business.

  1. Commerce :-
Business also includes those activities which facilitate the exchange of goods between consumer and producers.

Example : Banking, insurance, marketing, storing and transport.

  1. Profession :-
Professional and vocational education also generates income. So the profession of doctor, lawyer and charted accountant is also included in business.

  1. Manufacturing :-
When any producer converts the raw material in to manufacturing goods it is also called business.
Note : Business does not include employment.


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