This paper is to develop applied knowledge and practical skills relating to Pakistan Direct and Indirect Tax System as applicable to individuals, unincorporated businesses and companies. Skills will be developed in dealing with specific technical issues arising in the direct and indirect taxes and to write professional advice on these issues. It also includes legal drafting of pleading and conveyancing.

The purpose of this paper is therefore to test the candidate’s ability to produce a report which a client would value. It does this by focusing on three skills in which candidates must demonstrate competence:

  • Structure
  • Identification and Application
  • Relevant Advice and Substantiated Conclusions

This paper will be examined in two parts through mini case studies. Each part will be examined separately over the duration of 3 hours and 15 minutes.

  • A) Direct Taxes

    • The Income Tax Ordinance, 2001
    • Notifications, Rules, General Orders and Circulars Issued under The Income Tax Ordinance 2001
    • Tax Advice, Legal drafting and pleading relevant to Direct Taxes (Note 1 &2)

  • B) Indirect Taxes

    • The Sales Tax Act, 1990
    • The Sales Tax Ordinance, 2000 Promulgated by The Provinces
    • The Islamabad Capital Territory (Tax on Services) Ordinance, 2001
    • The Federal Excise Act, 2005
    • Notifications, Rules, General Orders and Circulars Issued Under the above-mentioned Laws
    • Tax Advice, Legal drafting and pleading relevant to Indirect Taxes (Note 1 & 2)

    Note 1. Legal Drafting and Pleading

    The part of syllabus provides an extensive understanding on Legal Drafting and Pleading.  It analyses the importance of pleadings as well as Order VI of the Civil Procedure Code, 1908. It further elaborates upon the format of various civil pleadings like plaint, written statement, injunction, affidavit etc.

    • Legal Drafting – General principles of drafting and relevant substantive rules
    • Pleading – Petition and Pleading in general and relevant to tax matters

    Note 2. Tax Advice

    The objective of this part of the syllabus is to bring aspects of direct taxes and indirect taxes together. Examination of this part covers all tax heads covered in this paper in an integrated manner.  Less detailed answers are required as the questions do not require students to do detailed calculations, students will need to summarise the tax issues. This section also covers anti-avoidance legislation, appeal procedures as well as giving consideration to the ethical issues that a Tax Adviser may face when giving tax advice.

    This part of the paper will examine students on their ability to:

    1.Translate complex legal concepts and the implications of same to taxpayers, including individuals, companies and other entities

    • Interact with other professionals to provide the final advice
    • Communicate implications of tax advice to taxpayers

    2.Support the successful and effective implementation of advice provided

    • Identify the steps required to implement any advice provided and interact with other professionals to agree the responsible parties
    • Prepare an implementation plan for the advice provided

    3. Understand the role of tax advisers in representing and defending taxpayers

    • Justify recommendations and research findings to specialists and non-specialists including the taxpayers and tax authorities
    • Represent the taxpayer in practical situations and formulate responses to unpredictable and complex problems
    • Interact professionally with taxpayers and tax authorities
    • Communicate with tax payers and with tax authorities on complex tax return issues
    • Critical awareness of the fundamental issues for the tax profession in representing and defending taxpayers