EXTENSION IN TIME LINES FOR AVAILING INCENTIVE SCHEME FOR BUILDERS AND DEVELOPERS

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The Government has provided Special incentives to Builders and Developers vide The Tax Laws (Amendment) Ordinance No. 1 of 2020 dated 17th April 2020. This Ordinance was issued by the president, as the Parliament was not in session. The amendments through this Ordinance were made part of the Income Tax Ordinance, 2001 through the Finance Act, 2020.

This package ended on 31st December 2020, which now been extended with various timelines through “The Income (Amendment) Ordinance, 2021” promulgated by President of Pakistan on 20th January 2020.

The Ordinance has extended various deadlines as provided in section 100D and eleventh Schedule of ITO. A comparison of previous deadlines with extended deadlines is provided in summarize form hereunder:

DescriptionOld Date / PeriodNew Date / Period
Last date of Project Completion of new and existing Projects30th September 202230th September 2023
Last date of registration of Builder/Developer and project with FBR where immunity from inquiry with respect to source of funds is not availed.31st December 202031st December 2021
Last date of registration of Builder/Developer and project with FBR where immunity from inquiry with respect to source of funds is availed.31st December 202030th June 2021
Last date for commencement of new project31st December 202031st December 2021
First tax year under fixed taxation regime in case of existing projectsTax Year 2020Tax Year 2020 or 2021 the option of taxpayer.
The maximum estimated project life for new project2.5 Years3.5 Years
The maximum estimated project life for existing project from tax year 2020 through tax year 20233 years4 years
Last date for deposition of money into new bank account to claim immunity from inquiry with respect to sources of funds being an individual31st December, 202030th June, 2021
Last date of transfer of investment into bank account of Company or Association of Persons in form of money through a crossed banking instrument to claim immunity from inquiry with respect to source of funds.31st December, 202030th June, 2021
Last date of transfer of land to Company or Association of Persons as investment to claim immunity from inquiry with respect to source of funds with condition that person shall have ownership of land as on 19th April 2020.31st December 202030th June 2021.
Last date for the first purchaser of building or unit of building to make full payment through crossed banking instrument.30th September 202231st March 2023
Last date for purchase of plot for the purchaser who intends to construct a building thereon to claim immunity from inquiry with respect to source of funds. Purchase of plot must be through normal banking channel31st December 2020 provided construction on such plot is also commenced on or before 31st December 2020.30th June 2021 provided construction on  such plot is commenced on or before      the 31st December 2021
Date of joining of additional partners or shareholders in a builder or developer after which such partners or shareholders shall not be eligible for exemption provided under sub-section (3) of section 100D (i.e., immunity from inquiry of source of funds)31st December 202030th June 2021