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Category: Taxation

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  • Late filers to get ATL status only after surcharge payment

    Late filers to get ATL status only after surcharge payment

    KARACHI: Late filers will only get their names on the Active Taxpayers List (ATL) after payment of penalty or surcharge.

    It has been observed that many taxpayers were filing their income tax returns for tax year after the last date of August 09, 2019 but they could not get their name on the ATL.

    The taxpayers noticed that their returns were filed and shown on the completed task but their names were not appeared on the ATL.

    However, this issued was resolved when they deposited penal amount to the Federal Board of Revenue (FBR).

    Officials at the FBR said that the late filers of Income Tax Return for Tax Year 2018 can pay “Surcharge for ATL” as defined under section 182(A) of Income Tax Ordinance 2001 by clicking on Tax Payment Nature “Misc” head in the PSID.

    “Only after the payment of surcharge will the name of the late filer become part of ATL.”

    In order to make normal payment through electronic mode, the officials said that in the e-Payments tab, a person will access Create Payment and then select Income Tax Annual Return option.

    The resulting selection will lead you to Income Tax e-Payment page. On this page a payment slip (PSID) will be created by:

    Selecting the relevant Tax Year

    Typing the Tax amount due

    Selecting the mode of payment

    Clicking the create button on the bottom of the page Confirm the e-Payment created. This will successfully create the e-Payment slip.

    The e-Payment slip can be deposited in any National Bank (NBP)/State Bank (SBP) branch. Select the nearest city where a taxpayer wants to deposit the payment slip from the drop down list.

    Click the print button to download the PSID on your computer. Deposit the PSID in any of the available branches of the city of your choice.

  • SRB suspends sales tax registration of Burshane Petroleum

    SRB suspends sales tax registration of Burshane Petroleum

    KARACHI: Sindh Revenue Board (SRB) has suspended sales tax registration of M/s. Burshane Petroleum Private Limited for defaulting payments for eight months and non-compliance of return filing for the same period.

    The SRB in a notice of suspension, said that short declaration of sales and non-payment of sales tax on services is contravention of Sales Tax on Services Act, 2011.

    The board said that record of the company revealed that it had M/s. Hascol Petroleum Limited declared purchases of Rs310.95 million including sales tax of Rs40.42 million from Burshane Petroleum Pvt. Ltd during February 2019 to September 2019, and had also paid sales tax on services amount of Rs32.339 million to M/s. Burshane Petroleum Pvt Limited for onward payment to SRB.

    However, Burshane Petroleum Pvt Limited have not filed their monthly sales tax return during February 2019 to September 2019 leading to sales suppression of Rs310.95 million and short payment of sales tax of Rs32.34 million.

    The SRB said that the suspension would only be revoked if the company takes following remedial action by November 28, 2019:

    To declare all sales and discharge all Sindh sales tax dues along with default surcharge.

    To e-file the true and correct monthly Sindh sales tax return for the tax periods.

    Further, the company has been directed to submit summary list along with copies of all invoices issued during January 2019 up to September 2019, copies of sales tax returns filed with other provincial sales tax authorities and copies of withholding certificates alongwith payment proofs.

    The SRB warned that in case of non-satisfactory response for failure to take remedial measures on or before November 28, 2019, further necessary action would be taken as envisaged under the Act.

  • Only return filers allowed to claim income tax refunds

    Only return filers allowed to claim income tax refunds

    KARACHI: Only those taxpayers have been allowed to claim income tax refunds, who filed their income tax returns electronically, officials at Federal Board of Revenue (FBR) said.

    Refund can be only claimed if the person has filed their income tax return electronically.

    A manual Return does not entitle you to a refund, the officials said.

    The refund amount should be clearly reflected in the taxpayers’ income tax returns filed on FBR’s portal i.e. Iris.

    Refund resulting from the income tax return can be claimed by filing a separate application in Iris.

    To check the status of application, the taxpayers can visit relevant Regional Tax Office (RTO).

    The refund can also be claimed later on after submitting the income tax return, but within two years from the date of filling of return (date of assessment) or from the date on which the tax was paid, whichever is later.

    However, persons filing tax return for tax year after the specified due date will not be entitled to refund during the period the person is not included in ATL and income tax authorities will not incur any liability of compensation for delayed refund for the period the person is not appearing in ATL and such period shall not be counted for the purpose of computing additional payment for delayed refund.

  • Properly filled stock statement to ensure refund in 72 hours: FBR

    Properly filled stock statement to ensure refund in 72 hours: FBR

    ISLAMABAD: Federal Board of Revenue (FBR) has said that property filled stock statement will ensure processing of sales tax refunds within 72 hours.

    The FBR said that properly filled Annex-H, which is form to provide details of stock statement, without objections and anomalies of data will ensure processing in 72 hours.

    The FBR said that Annex-H is a stock statement of input goods / services which shows flow of inputs in terms of quantity, value and sales tax involved in opening / closing balances, purchases and consumption in exports and local sales.

    Quantities / values of finished products (exports and local) and output tax on local sales should not be mentioned in Annex-H3-Use Annex H to upload for the month transactions i.e. purchase, import and Consumption only, Opening and Closing are derived /calculated automatically.

    Same is applicable for Excel file uploading otherwise objection of duplicate value will arise.

    The brought forward and carry forward tax amount in the return should match with opening balance and closing balance tax amount in the Annex-H5

    The value of purchases and input tax paid thereon in the return should match with the corresponding figures in columns “purchased / imported during the month” in Annex-H6-Generally, refund amount in column 29 of return is based on following formula:

    Refund claim=Input Tax Consumed in Exports/ Zero Rated(Col 22 of Annex-H)–Net payment against local supplies

    OR

    Refund claim = Input Tax Consumed in Exports/ Zero Rated(Col. 22 of Annex-H)+Input tax consumed in local supplies (Col. 20 of Annex-H)− Accumulated debit from monthly return (Row 17 of return)

    Mark invoice-wise inadmissible input tax for SRO 490 for accuracy in Annex-A of return

    Avoid claiming input tax credit more than once on same GD / invoice (e.g. both in provinces and FBR return)

    Credit brought forward from previous claim will be made available in opening balance in Annex-H.

    Recovery / arrears data will be made available in Annex H Declaration

    Following items relating to toll manufacturing have been added in “Item description” in Annex-H

    a.Sizing

    b.Yarn Dyeing

    c.Yarn Doubling

    d.Weaving

    e.Knitting

    f.Processing (Bleaching, Dyeing and Printing)

    g.Stitching

    h.Embroidery

  • Tax return filing not mandatory for widow, orphan, disabled persons

    Tax return filing not mandatory for widow, orphan, disabled persons

    KARACHI: Filing of income tax return is not mandatory for persons including widow, orphan and disabled persons for sole reasons mentioned in the Income Tax Ordinance, 2001.

    Officials of Federal Board of Revenue (FBR) on Tuesday said that the Section 115 of Income Tax Ordinance, 2001 categorized persons, who are not required to file income tax returns.

    It said that the following persons shall not be required to furnish a return of income for a tax year solely by reason of sub-clause (iii), (iv),(v) and (vi) of clause (b) of sub-section (1) of section 114 –

    (a) A widow;

    (b) an orphan below the age of twenty-five years;

    (c) a disabled person; or

    (d) in the case of ownership of immovable property, a non-resident person.

    Sub-clause (iii), (iv),(v) and (vi) of clause (b) of sub-section (1) of section 114 are as under:

    (iii) owns immovable property with a land area of five hundred square yards or more or owns any flat located in areas falling within the municipal limits existing immediately before the commencement of Local Government laws in the provinces; or areas in a Cantonment; or the Islamabad Capital Territory;

    (iv) owns immoveable property with a land area of five hundred square yards or more located in a rating area;

    (v) owns a flat having covered area of two thousand square feet or more located in a rating area;

    (vi) owns a motor vehicle having engine capacity above 1000 CC

    The officials said that any person who is not obliged to furnish a return for a tax year because all the person’s income is subject to final taxation under sections 5, 6, 7, 148, 151 and 152, sub-section (3) of section 153, sections 154, 156 and 156A, sub-section (3) of section 233 or sub-section (3) of section 234A shall furnish to the Commissioner a statement showing such particulars relating to the person’s income for the tax year in such form and verified in such manner as may be prescribed.

    (4A) Any person who, having furnished a statement, discovers any omission or wrong statement therein, he may, without prejudice to any other liability which he may incur under this Ordinance, furnish a revised statement for that tax year, at any time within five years from the end of the financial year in which the original statement was furnished.

    (5) Subject to sub-section (6), the Commissioner may, by notice in writing, require any person who, in his opinion, is required to file a prescribed statement under this section for a tax year but who has failed to do so, to furnish a prescribed statement for that year within thirty days from the date of service of such notice or such longer period as may be specified in such notice or as he may, allow.

    (6) A notice under sub-section (5) may be issued in respect of one or more of the last five completed tax years.

  • PTBA estimates one million income tax returns shortfall in case no date extension

    PTBA estimates one million income tax returns shortfall in case no date extension

    LAHORE: The apex tax bar of the country on Tuesday said that the shortfall in income tax return filing may exceed above one million in case no further extension in date is granted.

    Pakistan Tax Bar Association (PTBA) in a communication sent to the chairman of Federal Board of Revenue (FBR) said that the taxpayers have filed 1.6 million returns electronically whereas the returns filed for tax year 2018 were 2.65 million till to date. “… means shortfall of 40 percent or 1,056,476 returns are still pending even after extension of date till November 30, 2019.”

    The PTBA urged the FBR that the date of filing income tax returns of individuals, salaried individuals, Association of Persons (AOP) for the tax year 2019 should be extended up to December 31, 2019 in order to facilitate the genuine taxpayers in the country, who are regularly contributing in the national exchequer as their moral and legal obligation.

    The tax bar previously through different communications on September 27, 2019 and October 28, 2019 already advised the FBR to extend the date for filing Tax Year 2019 returns up to December 31, 2019.

    The FBR chairman has been informed that the draft return Form 2019 for individuals, salaried individuals and AOPs was uploaded on August 23, 2019 through SRO 951 and final return 2019 was uploaded on IRIS on September 02, 2019 through SRO 979 of 2019 which shows laps of statutory period of two months and all burden shifts on FBR.

    Further, the manual return of income form for tax year 2019 was issued on September 27, 2019 FBR through SRO 1160 of 2019, so the small volume taxpayers could file their returns of income for the year 2019 within the stipulated time.

    Furthermore, as per law and statutory time period for filing of income tax return is 90 days under Section 118 of the Income Tax Ordinance, 2001 read with rule 34 of the Income Tax Rules, 2002.

    The PTBA said that the date for filing income tax returns was extended up to August 09, 2019 for tax year 2018. This shows the FBR allowed 11 months for the filing for last year returns and for current year it is allowing only two months, which is injustice with the bar members and taxpayers as well.

    The tax bar also pointed out towards the political uncertainty due to sit-in at Islamabad, which was remained continue from start of November 2019 to mid of this month.

  • Income tax return filing hits new record high of 2.7 million

    Income tax return filing hits new record high of 2.7 million

    ISLAMABAD: Measures to increase tax burden on non-compliant persons have resulted into record income tax return filing of 2.7 million for tax year 2018.

    (more…)
  • Prevailing Customs tariff for fiscal year 2019/2020

    Prevailing Customs tariff for fiscal year 2019/2020

    KARACHI: Federal Board of Revenue (FBR) has issued updated Customs tariff for fiscal year 2019/2020, which have been imposed from July 01, 2019.

    According to the FBR the following documents to ascertain the prevailing customs tariff:

    Fifth Schedule to Customs Act w.e.f July 01 2019

    First Schedule Customs Act w.e.f July 01 2019

    Pakistan Customs follow the HS Code (Harmonized System Codes) or PCT Codes ( Pakistan Customs Tariff Codes) for Classification of Goods, these code consist of eight digits where first two represent Chapter and second two represent Sub- chapter and after decimal place four digit represent code of item.

    Find PCT Code or HS code by Description of Goods

    Find Description of Goods by PCT Code or HS code

    International Classification of Goods in Harmonized System

  • FBR further extends sales tax return filing up to Nov 29

    FBR further extends sales tax return filing up to Nov 29

    ISLAMABAD: Federal Board of Revenue (FBR) on Monday further extended the last date for filing sales tax return for the month of October up to November 29, 2019.

    The FBR issued a notification for extension in date of submission of sales tax and federal excise return for the tax period of October 2019.

    The FBR extended the date of submission of sales tax and federal excise return for the tax period of October, 2019 which was due on November 18, 2019 and extended up to November 25, 2019 and now further extended up to November 29, 2019.

    It may be worth mentioning here that the last date for filing income tax returns for tax year 2019 is November 30, 2019. The extension in date for sales tax return filing will burden the tax practitioners and lawyers in return filing and taxpayers will have an excuse for demanding further extension in income tax return filing date.

  • Procedure to check active taxpayer status

    Procedure to check active taxpayer status

    ISLAMABAD: Appearance of a taxpayer in Active Taxpayers List (ATL) has become very important to avail benefit of reduced withholding income tax rate.

    The ATL has become even more important after the inclusion of 10th Schedule to Income Tax Ordinance, 2001 through Finance Act, 2019 under which a person, who is not part of the ATL, is subject to 100 percent additional withholding tax.

    According to Federal Board of Revenue (FBR) a taxpayer can check its active status in three different ways, which included:

    Verification through Online Portal:

    The ATL status check allows you to confirm your Active Taxpayer status.

    Check Active Taxpayer status by SMS:

    Check Individual’s Active Taxpayer status by SMS

    Type “ATL (space) 13 digits Computerized National Identity Card (CNIC)” and send to 9966.

    Check Active Taxpayer status of AOP and Company by SMS

    Type “ATL (space) 7 digits National Tax Number (NTN)” and send to 9966.

    To check active status by taxpayers of Azad Jammu and Kashmir by SMS

    For Individual, type AJKATL (space) CNIC (without dashes). Send it to 9966.

    Having NTN AJKATL (space) 11 digit NTN (without dashes). Send it to 9966.

    The Active Tax Payer’s List of AJK is to be considered at par with the ATL (Income Tax) after amendment in the Income Tax Ordinance 2001 through Finance Act 2018.

    Check Active Taxpayer status by downloading ATL from FBR official website.

    DOWNLOAD LATEST ATL

    The FBR said that a person appearing on the ATL will have following benefits:

    Lower rates of tax deduction at source by banks on both profits and cash withdrawals

    Reduction on withholding tax (tax already deducted from your income and gains) when registering and transferring motor vehicles

    Lower rate of tax on buying and selling of property

    Lower withholding tax rate on capital gains on sale of securities

    Charges for tax on dividend will be lower

    Lower rate of withholding tax on prize bond winnings

    Allows you to claim back overpaid tax that has been withheld.

    The FBR said that a person’s name will be part of the current ATL, if the Tax Return filed pertains to the Tax year of the relevant ATL.

    For example, to be part of the ATL published on 1st March 2018, a person must have filed a Tax return for the Tax year 2017. Similarly, to be a part of the ATL published on 1st March 2019, a person must have filed a Tax Return for the Tax year 2018.

    Restriction on including a person’s name on ATL, if the person has not filed Tax Return by the due date specified by Income tax authorities was introduced through Finance Act, 2018. For example, to be part of the ATL published on 1st March 2019, a person must file a Tax Return by the specified due date for the Tax year 2018.

    However, through Finance Act, 2019 a person’s name can be part of ATL, even if the person has filed Tax Return after the due date specified by Income Tax authorities.

    Furthermore, a surcharge for placement on ATL after due date of filing of Tax Return will be charged as under:

    Company: Rs20,000

    Association of Persons: Rs10,000

    Individual: Rs1,000

    A company or an AOP shall be included in the ATL, whose return is not to be filed due to incorporation or formation after 30th day of June relevant to the Tax year pertaining to the ATL.

    Joint account holders as an entity shall be deemed to be part of ATL if any of the persons in the joint account have met the criteria of being included in the ATL.

    Bank account held in the name of a minor shall be considered part of ATL if the parents, guardians of the minor or any person who has deposited money in minor’s account are deemed to have met the criteria of being included in the ATL.

    The FBR said that the late filers of Income Tax Return for Tax Year 2018 can pay “Surcharge for ATL” as defined under section 182(A) of Income Tax Ordinance 2001 by clicking on Tax Payment Nature “Misc” head in the PSID.

    The name of late filer will appear on the ATL only after the payment of surcharge, the FBR added.