Karachi, September 2, 2025 – The Federal Board of Revenue (FBR) has made it clear that return filing for the tax year 2025 is mandatory for individuals whose annual income from business exceeds Rs350,000.
This requirement falls under Section 114 of the Income Tax Ordinance, 2001, which governs income tax return procedures in Pakistan.
Key Requirement for Business Income
Subsection (1A) of Section 114 explains that any individual earning between Rs300,000 and Rs400,000 annually under the head “Income from Business” must submit a return of income. This ensures proper documentation of earnings and compliance with national tax laws.
Who Else Must File a Return?
Apart from small business owners, Subsection (1) of Section 114 outlines other categories of taxpayers who are required to file returns, including:
• Companies and non-profit organizations.
• Any person whose taxable income exceeds the maximum non-taxable limit.
• Individuals subject to final taxation under any provision of the law.
• Persons who have been charged tax in any of the previous two years.
• Individuals claiming loss carry-forwards.
• Property owners with land over 500 square yards or flats exceeding 2,000 square feet.
• Motor vehicle owners with engine capacity above 1000 CC.
• Persons holding a National Tax Number (NTN) or connected to commercial/industrial electricity connections exceeding Rs500,000 in annual billing.
• Professionals registered with trade associations, bar councils, medical councils, engineering councils, and other recognized bodies.
• Individuals with foreign income or assets, as per Section 116A.
Importance of Timely Filing
Filing a return ensures legal compliance and avoids penalties, which may include fines or legal action. Moreover, maintaining an accurate record of income helps individuals apply for loans, visas, and financial facilities.
Disclaimer: This article provides general tax information. Taxpayers should consult professionals for personalized guidance regarding their income tax return filing.