ITO Section 26 | Scientific research expenditure.

ITO Section 26

Scientific research expenditure.

(1) A person shall be allowed a deduction for scientific research expenditure incurred in Pakistan in a tax year wholly and exclusively for the purpose of deriving income from business chargeable to tax.

(2) In this section — “scientific research” means any [activity]  [undertaken in Pakistan] in the fields of natural or applied science for the development of human knowledge; “scientific research expenditure” means any expenditure incurred by a person on scientific research  [undertaken in Pakistan] for the purposes of developing the person’s business, including any contribution to a scientific research institution to undertake scientific research for the purposes of the person’s business, other than expenditure incurred

• (a) in the acquisition of any depreciable asset or intangible;
• (b) in the acquisition of immovable property; or
• (c) for the purpose of ascertaining the existence, location, extent or quality of a natural deposit; and

“scientific research institution” means any institution certified by the [Board] as conducting scientific research in Pakistan.