It has been made mandatory for the registered persons to provide details of all unregistered persons who made purchases of above Rs.100000. The information of CNIC of unregistered persons should be provided through sales tax return for the month of July 2020 in August 2020.
The government has made it mandatory for sales tax registered persons to provide information of unregistered persons including their CNICs, names, and addresses on making supplies above Rs.50000 through finance act 2020.
There were difficulties in the implementation of this condition due to disputes between FBR and the retailers.
Finance Act, 2020 has enhanced the limit of purchases by unregistered persons to Rs.100000 with and effect from July 01, 2020.
Section 23 of the Sales Tax Act, 1990 requires the registered persons to provide the details of unregistered persons while issuing a tax invoice.
Section 23 (Tax Invoices):
A registered person making a taxable supply shall issue a serially numbered tax invoice at the time of supply of goods containing the following particulars, in Urdu or English language, namely:-
- name, address and registration number of the supplier;
- name, address and registration, number of the recipient and NIC or NTN of the unregistered person, as the case may be, excluding supplies made by a retailer where the transaction value inclusive of sales tax amount does not exceed rupees fifty thousand if the sale is being made to an ordinary consumer.
Explanation:
Ordinary customer means any person buying the goods for his own consumption and not for the purpose of resale or processing.
Condition of NIC or NTN shall be effective from 1st August 2019:
- date of issue of invoice;
- description including count, denier, and construction in case of textile yarn and fabric, and quantity of goods;
- value exclusive of tax;
- amount of sales tax;
- value inclusive of tax:
The Board may, by notification in the Official Gazette, specify such modified invoices for different persons or classes of persons.
if it is subsequently proved that CNIC provided by the purchaser was not correct, the liability of tax or penalty shall not arise against the seller, in case of a sale made in good faith.
- No person other than a registered person or a person paying retail tax shall issue an invoice under this section.
- A registered person making a taxable supply may, subject to such conditions, restrictions, and limitations as the Board may, by notification in the Official Gazette, specify, issue invoices to another registered person electronically and to the Board as well as to the Commissioner, as may be specified.
- The Board may, by notification in the Official Gazette, prescribe the manner and procedure for regulating the issuance and authentication of tax invoices.”