ITO Section 39

Income from other sources. 

(1) Income of every kind received by a person in a tax year,  [if it is not included in any other head,] other than income exempt from tax under this Ordinance, shall be chargeable to tax in that year under the head “Income from Other Sources”, including the following namely: —

• (a)  [Dividend;]
• (b)  [royalty;]
• (c) profit on debt; 
• [(cc) additional payment on delayed refund under any tax law;]
• (d) ground rent;
• (e) rent from the sub-lease of land or a building;
• (f) income from the lease of any building together with plant or machinery; 
• [(fa) income from provision of amenities, utilities or any other service connected with renting of building;]
• (g) any annuity or pension;
• (h) any prize bond, or winnings from a raffle, lottery [, prize on winning a quiz, prize offered by companies for promotion of sale] or cross-word puzzle;
• (i) any other amount received as consideration for the provision, use or exploitation of property, including from the grant of a right to explore for, or exploit, natural resources;
• (j) the fair market value of any benefit, whether convertible to money or not, received in connection with the provision, use or exploitation of property;
• (k) any amount received by a person as consideration for vacating the possession of a building or part thereof, reduced by any amount paid by the person to acquire possession of such building or part thereof;
• [(l) any amount received by a person from Approved Income Payment Plan or Approved Annuity Plan under Voluntary Pension System Rules, 2005
• [(Ia) subject to sub-section (3), any amount or fair market value of any property received without consideration or received as gift, other than gift received from  [relative as defined in sub-section (5) of section 85] ]  [; and] 
• [(lb) income arising to the shareholder of a company, from the issuance of bonus shares;]

(2) Where a person receives an amount referred to in clause (k) of subsection (1), the amount shall be chargeable to tax under the head “Income from Other Sources” in the tax year in which it was received and the following nine tax years in equal proportion.

(3) Subject to sub-section (4), any amount received as a loan, advance, deposit [for issuance of shares] or gift by a person in [a tax year] from another person (not being a banking company or financial institution) otherwise than by a crossed cheque drawn on a bank or through a banking channel  [or through digital means as defined in section 2] from a person holding a National Tax Number  [ ] shall be treated as income chargeable to tax under the head “Income from Other Sources” for the tax year in which it was received.

(4) Sub-section (3) shall not apply to an advance payment for the sale of goods or supply of services. 

[(4A) Where —

• (a) any profit on debt derived from investment in National Savings Deposit Certificates including Defence Savings Certificate paid to a person in arrears or the amount received includes profit chargeable to tax in the tax year or years preceding the tax year in which it is received; and
• (b) as a result the person is chargeable at higher rate of tax than would have been applicable if the profit had been paid to the person in the tax year to which it relates, the person may, by notice in writing to the Commissioner, elect for the profit to be taxed at the rate of tax that would have been applicable if the profit had been paid to the person in the tax year to which it relates.]

[(4B) An election under sub-section (4A) shall be made by the due date for furnishing the person’s return of income for the tax year in which the amount was received or by such later date as the Commissioner may allow by an order in writing.]

(5) This section shall not apply to any income received by a person in a tax year that is chargeable to tax under any other head of income or subject to tax under section [5, 5AA, 6, 7 or 7B].

(6) [Omitted]