The National Clearing Company of Pakistan Limited (NCCPL) collected capital gains tax (CGT) amounting to more than Rs1.25 billion on transactions that were executed and settled during the fiscal year 2013.
According to a statement issued by NCCPL CEO Muhammad Lukman, over 45%, or Rs568 million, of the total CGT on equity trades carried out during the last fiscal year was collected in the fourth quarter ended June 30. The amounts of CGT collected in the first, second and third quarters were Rs206 million, Rs187 million and Rs289 million, respectively.
NCCPL is responsible for computing, determining, collecting and depositing CGT in accounts of the Federal Board of Revenue (FBR) under the CGT Rules that have been revised through the promulgation of Finance (Amendment) Ordinance, 2012, which became effective from April 24, 2012.
It should be noted that no CGT is applicable in case the security is sold after being held for more than 12 months. If the security is sold within six months of its purchase, 10% of capital gains is deducted by the NCCPL as CGT. However, the CGT rate is 8% for a security whose holding period is more than six months but less than 12 months.
Under the new CGT regime, CGT is determined and computed on the transactions and their values as reported to the regulators. A capital loss in any financial year is set off against capital gains that take place during the same financial year. But a capital loss in any financial year is not carried on to a subsequent financial year.
The CGT regime applies to individual investors, brokers and corporate entities. Mutual funds, banks, non-banking finance companies, insurance companies, modaraba compa
Published in The Express Tribune, July 30th, 2013.
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