According the income tax ordinance it means any amount paid or payable for :
a. The use of any patent, invention, design, model, trademark, secret formula etc.
b. Any amount paid or payable for the use of copyright artistic or scientific work, or video tapes for T.V. Or radio.
c. Any amount paid or payable for the right to receive any sounds or visual images through satellite cable or similar technology for T.V. And Internet.
Example :- Some time private companies pay the royalty to show the cricket match through satellite cable in our country played in any part in the world.
d. Any amount which is received to supply any technical or commercial knowledge or experience or skill is also called royalty.
e. The right to use any industrial, commercial or scientific equipment.
f. The disposed of any property right referred above.
In the above cases royalty means any amount paid or payable as considered for the transfer of rights to use the assets.
SPECULATION BUSINESS :-
It means any business in which contract for the purchase and sale of any commodity (including stock and shares) is periodically or ultimately settled otherwise than by actual delivery or transfer of the commodity. Following are not included in business :
a). A contract by person during the manufacturing or mercantile business to guard against loss through future price fluctuations for the purpose of fulfilling the other contracts for the actual delivery of the goods.
b). IN case of stocks and shares a contract by a dealer or investor to guard against loss in his holding through price fluctuation.
c). A member of stock exchange or forward entered in to a contract in the course of transaction to guard against any loss which may arise in the ordinary course of the persons business.
TAX PAYER :-
Under income tax ordinance tax payer means;
a). A person who receives income which is chargeable to tax.
b). Representative of a person
c). A person responsible to collect, deduct and deposit it with the govt.
d). A person required to furnish a return and pay tax.
Following persons are required to file the return,
1. Every company.
2. If total income of any person exceeds than specific amount in a tax year.
3. Any person who owns a motor vehicle.
4. Any person who travel abroad except Hajj or Umrah.
5. Subscriber of a telephone or mobile.
6. Member any club who pays admission fee more than specific amount.
7. If the income of the person has been charged to tax in any of the proceeding years.
Following persons are exempted to file the return of their total income,
a) A disable person
b) An orphan below 25 years of age.
c) A widow.
d) A non-resident in respect of immoveable property.