Institute of Business Management

College of Business Management

COURSE OUTLINE- TAXATION

Course Code: Taxation (ACC 503)

Total Credit hours: 45
Duration: 26 sessions of 1.5 hours each= 39 hours

Overall aims of course

This course out-line has been drawn, almost exclusively, from the Income Tax Ordinance 2001
which is the centre piece of the income tax administration in Pakistan.
In this course outline sections and sub-sections have also been mentioned which are the keys to
access comprehensive provisions in the IT Ordinance.
This course outline has been drawn with the primary objective of giving comprehensive
understanding of the Income Tax Law in Pakistan. Furthermore, this may enable one to easily
access all the sources of Income Tax Law for dealing with any income tax problem in real life
situations.
For the sake of better grasping of the topics, it is also emphasized that teaching of each topic
must also be supplemented with suitable illustrations, solution of practical problems and study of
tax case law.
A business graduate is expected to adopt a business career either as an entrepreneur or as a
company executive. In either case he will have to deal with taxation problems. The completion
of this course offers valuable guidelines in this respect.
This outline represents an optimum course, as inclusion of any more subject is not feasible in the
time frame while deletion of any topic would render the course inadequate.
Following is the COURSE OUTLINE with course contents divided into topics and sub-topics to
be taught in 26 sessions of one and a half hour each. The learning objectives are also mentioned
against each topic and the sub-topics

Course Contents:

Sessio Topic Sub-Topics Covered Learning Objectives Resource

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1. PRELIMINARY History, objective and To offer historical Text books,

sources of income tax perspective, the goal the Income Tax
law in Pakistan. law purports to achieve Ordinance
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. and the references and 2001, Income

the sources of the law to Tax Rule 2002,
draw upon SROs,
Circulars,
Case Law
&
Handouts on
important
subjects
2. Definition Section 2 (1) to (74) To familiarise with key
Charge of Tax Section 4 (1) to (6) words and terms

3. HEAD OF These sections and

INCOME Definition and scope of subjects being most
Salary income section 12 commonly used, their
knowledge would be
useful in the same
proportion.
4. Salary Value of perquisites Same as above.
Section 13 and Rule 3
to 7
5. Salary Employee share scheme Same as above.
Section
6. Salary Exemption and tax Same as above
concession
Second Schedule
Provident and other
funds
Sixth Schedule
7. HEAD OF The knowledge of
INCOME taxability under this head
Income from Section 15 is growing in importance
Property Section 16 with the growing number
Chargeability of property owners and
Non-adjustable widening scope of
advance rent taxation of this income.
8. HEAD OF The knowledge of
INCOME Meaning and scope. taxability of this income
Income from Section 18 is by far the most
Business Speculative business important from the point
Section 19 of view of revenue as
well as the clout of the
tax payers which include
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the powerful corporate

sector.
9. Income from Deduction of expenses, Same as above
Business Section 20
Deduction inadmissible,
Section 21
10. Income from Deduction: specific Same as above
Business provision
Section 22 to 31
11. Income from Deduction Same as above.
Business Rule 10 to 13 and Third
Schedule
12. TAX Section 32 to 36 This subject is related to
ACCOUNTING method of accounting of
business income and its
learning objective is the
same as that of business
income.
13. HEAD OF Definition and Learning the taxability of
INCOME computation income under this head is
Capital Gain Section 37 now more necessary as
Deduction of loss more cases of Capital
Section 38 Gains have been brought
within the ambit of
taxation.
14. Capital Gain Disposal of Asset, Same as above.
Section 75
Cost of Asset, Section
76
Consideration on
Disposal of Asset,
Section 77
15. HEAD OF Definition, Section 39 It is a residual head of
INCOME Deduction, Section 40 income which includes
Income from miscellaneous incomes.
Other Sources Its learning would add to
a comprehensive
knowledge of taxation.
16. Set-off of Losses Definition and These are to be learnt in
Carry Forward explanation, Section 56 the context of mostly
of Losses Definition and rules, business and salary
Section 57, 58 & 59 incomes and so is the
importance of its
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learning.
17. Deductible Zakat, Section 60 Same as above
Allowances Workers welfare fund,
Section 60 A
Workers participation
fund, Section 60 B
18. Tax Credit Charitable donation, Same as above
Section 61
Investment in share,
Section 62
Contribution to
Approved Funds,
Section 63
Profit on Debt, Section
64
19. Resident and Section 81 to 84 & Its learning is important
Non-resident Section 11(5) & (6) for the taxation of non-
persons residents whose number
is growing with foreign
investment and
globalization.
20. Taxation of Section 86 Its learning is important
Individual Section 92 for assessment process
Taxation of
Association of
Persons
21. Taxation of Section 94 to 97 Same as above
Companies
22. Return of Section 114 to 119 Same as above
Income Section 120 to 126
Assessment
23. Presumptive Section 4 (4) & (5) Its learning is important
Income/Taxation as most of the taxation in
the country falls under
this tax regime.
24. Recovery, Section 138, 138 A & Handling of tax matters
Refunds 140 & 170(Refund) would often include the
Penalties Section 182 to 190 refund cases whose
knowledge could be very
useful. Recovery
proceedings are not very
common comrade to the
penalty proceedings.
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25. Appeal Section 127 to 136 Appeal is very common

Alternate in tax cases and the
Dispute knowledge of the
Resolution procedures for filing of
appeal and hearing of the
cases are very important.
26. Withholding Section 148 to 156 These are very common
Tax, Advance for all heads of income
Tax, Deduction and their knowledge is
of Tax at Source indispensible to deal with
taxation problems.

Teaching and learning methods

70%
Lectures:

Practical training: %

Seminar/Workshop: %

Class activity: 30%

Student assessment methods

Quizzes 10%

Mid-term 30%

Final Examination 40%

Class Participation/Term Report/Assignments 20%

Total 100%

 The students are required to take frequent class tests, submit assignments and at least one
full report on an important subject relating to the course during the semester.

 The reports are also presented by the concerned students before the class on a pre-
assigned date and the student presenting the report is asked to explain some points of his
report.
  Often cross discussion amongst the students on difficult subjects are encouraged which is
mutually enlightening and beneficial.

 Sometimes all the students in the class are asked to read the text of the same law, and
while some are asked to explain the text, the other students are asked to check the
accuracy of the explanation. Such exercises are often found to be very productive.

SOME SUGGESTIONS FOR IMPROVEMENT:

 Upto now the taxation classes are held in rooms with no multi-media facility. Taxation
being comparatively a difficult subject, this facility is likely to improve the teaching and
learning outcome.

 The students should be organized to visit High Court and the Tax Tribunals where tax
cases are decided and to visit the important tax offices where the tax administration is in
operation. Such visits would help give reality touch to the students’ academic pursuits
and thus an easier and better understanding of the subject.

Rubrics for Marking

SKILLS Advanced Proficient Basic Minimal

Comprehension Always Frequently Usually Unsatisfactory
and Analysis understands the understands the understands the knowledge and
key issues in key issues in key issues in understands of
Taxation. Taxation. Taxation. the key issues in
Accurately Understand the Familiar with Taxation.
understand the Income Tax the Income Inadequate
Income Tax Law in Tax Law in Knowledge of
Law in Pakistan Pakistan and Pakistan but the Income Tax
and demonstrates demonstrates sometimes Law in
excellent good analytical faces difficulty Pakistan.
analytical skills skills in applying it. Generally faces
difficulty in
analyzing the tax
case law due to
weak concepts.
Planning and Excellent Good Satisfactory Unsatisfactory
Forecasting understanding understanding the understanding understanding the
the use taxation use taxation in the use taxation use taxation in
in operational operational in operational operational
planning planning process. planning planning
process. Able to Able to calculate process. Able to process. Able to
calculate the tax the tax on various calculate the tax calculate the tax
on various incomes for on various on various
 incomes for present and future incomes for incomes for
present and planning present and present and
future planning future planning future planning
Occasionally Finds difficulty
faces difficulty in analyzing the
in analyzing the taxable income
taxable income
Decision Making Always Frequently Usually Rarely
understands the understands the understands the understands the
techniques techniques techniques techniques
required to take required to take required to take required to take
calculated calculated income calculated calculated
income tax tax decisions as income tax income tax
decisions as an an accountant of decisions as an decisions as an
accountant of an an organization accountant of an accountant of an
organization. organization organization
Problem Solving Always finds a Frequently seeks Usually seeks Rarely seeks out
number of ways out other ways to out other ways other ways to
to solve the solve the to solve the solve the problem
problem on own problem, and problem, but and frequently
initiative rarely needs occasionally needs support
support or needs support and guidance
guidance or guidance
Personal Always Frequently Usually Rarely
Management demonstrates demonstrates demonstrates demonstrates
personal personal personal personal
management management management management
skills, and is skills skills skills
eager to learn
Team work Always Frequently Usually Rarely
demonstrates demonstrates demonstrates demonstrates
effective effective effective effective
teamwork skills teamwork skills teamwork skills, teamwork skills,
and often takes and rarely needs and occasionally and frequently
initiative in a support or needs support or needs support
group setting that guidance in guidance and guidance.
exceeds required teamwork Often wants to
skills activities work
independently
Participation in Always Frequently Usually Rarely
projects and tasks completes the completes the completes the completes the
assignments in assignments in assignments in assignments in
time with his/her time with his/her time with his/her time with his/her
 own efforts and own efforts and own efforts and own efforts and
actively actively actively actively
participates in participates in participates in participates in
class room class room class room class room
discussions with discussions with discussions with discussions with
keen interest. keen interest. keen interest .s keen interest .s

Recommended Texts:

Textbook:
1. Practical Handbook of Income Tax By Dr. Ikram ul Haq
2. Income Tax Ordinance 2001
3. Income Tax Rule 2002
4. SROs and Circulars
5. Business pages of English dailies in Pakistan
Room#: ___ Extension: ____

E-Mail: ___________________

Approved by:

Head of Department
Date: / /