No tax on factory to warehouse movements
ISLAMABAD: To curb harassment of taxpayers and streamline the movement of goods, the Federal Board of Revenue (FBR) has announced that transferring goods from a factory to a registered person’s own warehouse under the same Sales Tax Registration Number (STRN) would not be treated as a taxable supply. As a result, inter-premises movement of goods also does not require the issuance of a digital…
The Federal Board of Revenue (FBR) has confirmed that moving goods from a factory to a warehouse owned by the same entity, under the same Sales Tax Registration Number (STRN), will not be considered a taxable supply. This change aims to reduce the burden on taxpayers and simplify the transportation process. Digital invoicing is unnecessary in these cases, but a Stock Transfer Note (STN) must be provided, explicitly marked "Stock Transfer — Not a Taxable Supply."
This note must accompany the goods at all times during transit and be presented upon request during any inspection. The STN procedure does not replace the need for a tax invoice when the receiving warehouse has a separate STRN. In such situations, the dispatching unit must issue a digital invoice, account for the output tax, and update their records accordingly.
The FBR has emphasized that taxpayers should not face unwarranted harassment and that any perceived non-compliance will be dealt with strictly under the law.
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