PESHAWAR, April 11: Maintenance of accounts and documents for persons of all income groups, including small traders, businessmen and professionals, would become mandatory from the start of the next financial year, according to official documents available with Dawn.

Necessary amendments to this effect are afoot in the income tax rules, 1982, in para-III, after chapter-A.

The draft amendments notified by the Central Board of Revenue (CBR) on March 22, last, suggest that a new chapter titled ‘chapter-AA’ be inserted after chapter-A in the income tax rules, 1982 thereby maintenance of books of account and documents would become mandatory for every income slab with effect from July 1, 2002.

A CBR circular sent to various trade and businessmen associations across the country states that “the universal self assessment, as being offered by Income Tax Ordinance, 2001 for all taxpayers depends on audit which necessitates maintenance of essential account keeping records”.

As per the draft amendment, every taxpayer deriving income chargeable under the head “income from business or profession” shall maintain proper books of account, documents and records with respect to (a) all sums of money received and expended by the taxpayer and the matters in respect of which the receipt and expenditure takes place; (b) all sales and purchases of goods by the taxpayer; (c) all assets of the taxpayer; (d) all liabilities of the taxpayer; and (e) in case of a taxpayer engaged in assembly, production, processing, manufacturing, mining or like activities, all items of cost relating to the utilization of materials, labour and other inputs.

Senior income tax lawyer Abdur Rauf Rohaila, when contacted, told Dawn that earlier maintenance of accounts and documents was mandatory for persons whose income exceeded Rs150,000.

But now maintenance of accounts would be mandatory for persons of all income groups including the small traders.

“This would mean that a shopkeeper with monthly income as meagre as Rs5,000 would be required to maintain proper accounts of his business transactions and if he is illiterate then he would have to employ an accountant to document his business irrespective of the fact that to which income group he belongs,” the President of the Sarhad Chamber of Commerce and Industry (SCCI) Malick Zahid said when contacted.

The SCCI members had also raised this issue with the Commerce Minister Abdul Razak Dawood during his visit to the chamber, on Tuesday.

Malick Zahid, talking to Dawn on Thursday, said that the move was tantamount to cause embarrassment to the government as “it is not acceptable to the traders community”.

The draft amendment, a copy of which is also available with Dawn, contains that if a person uses fiscal electronic cash register or a computerized accounting software, it may issue the fiscal electronic cash register or computer generated cash memo/ invoice/receipt in the format and manner so approved by the respective commissioner of income tax.

Besides, it separately lays down procedures and conditions required to fulfil in terms of maintaining accounts and documents for persons with income upto Rs150,000, from Rs150,000 to Rs300,000, beyond Rs300,000.

Persons with business income exceeding Rs300,000 including whole-sellers, distributors, dealers and commission agents would be required to maintain “numbered cash memo/invoice/receipt for each transaction of sale or receipt with taxpayer’s business name, address, national tax number and sales tax registration number, if any,” adding that “such cash memo/invoice/receipt must indicate the description, quantity, value of goods sold or services rendered and in cases of whole sellers, distributors, dealers and commission agents where a single transaction exceeds Rs10,000 name and address of the customer”.

Professionals including medical practitioners, legal practitioner, accountant, auditor, architect, engineer, etc., would also need to meet the above mentioned requirements to ensure maintenance of accounts in addition to maintain “such patient slip/ invoice/ receipt must indicate the details (not confidential) of treatment/case/services rendered etc., and where a single transactions exceeds Rs10,000 name and address of the patient/client etc.

Manufacturers with turnover exceeding Rs2.5 million and companies would need to maintain numbered cash memo/ invoice/ receipt for each transactions of sale or receipt with taxpayer’s business name, address, national tax number and sales tax registration number, if any.

The amendment contains that (such) cash memo/invoice/receipt must indicate the description, quantity, value of goods sold or services rendered and where a single transaction exceeds Rs10,000, name and address of the customs.

In addition to this, persons deriving income from salary, rent, dividends and capital gains would also need to document their income.

In the case of salaried person salary certificate would be essential, whereas for person deriving income from property, copy of the rent agreement and proof of payment of property tax would be required.

For persons deriving income from capital gains, maintenance of proof of purchase and sale of assets would be essential.

Whereas, in the case of persons deriving income from dividend and interest the maintenance of dividend warrants and certificates/bank statement of interest and documents of payment of tax would be essential.