Clear Lahore 24°C Clouds Karachi 29°C Clouds Islamabad 20°C

← All sections

s. 30

Profit on non-performing debts of a banking company or development finance institution

Tax On Taxable Income

(1) A banking company or development finance institution or Non-Banking Finance Company (NBFC) or modaraba shall be allowed a deduction for any profit accruing on a non-performing debt of the banking company or institution or Non-Banking Finance Company (NBFC) or modaraba where the profit is credited to a suspense account in accordance with the Prudential Regulations for Banks or Non-Banking Finance Company or modaraba Non-bank Financial Institutions, as the case may be, issued by the State Bank of Pakistan or the Securities and Exchange Commission of Pakistan .
(2) Any profit deducted under sub-section (1) that is subsequently recovered by the banking company or development finance institution or Non- Banking Finance Company (NBFC) or modaraba shall be included in the income of the company or institution or Non-Banking Finance Company (NBFC) or modaraba chargeable under the head Income from Business for the tax year in which it is recovered.
Amendment history (6)
  • Inserted by the Finance Act, 2003.
  • The words “banking company or” omitted by the Finance Act, 2009.
  • Inserted by the Finance Act, 2004.
  • Added by the Finance Act, 2004.
  • The words “a banking company or” omitted by the Finance Act, 2009.
  • The words “Non-bank Financial Institutions” substituted by the Finance Act, 2003.

Amendment notes captured from the source page(s); they may include changes to neighbouring provisions.

Source FBR PDF page 83

Unofficial reference, compiled from the FBR’s consolidated Income Tax Ordinance 2001 (amended up to 30 June 2026). Provided for general information only — not an official FBR publication and not legal or tax advice. Always verify against the official FBR text before relying on it for filing or any decision.