If you are a taxpayer in Pakistan and have paid more tax than you were liable for, you may be eligible to claim an income tax refund from the Federal Board of Revenue (FBR) in tax year 2026. Understanding the rules and procedures under Section 170 of the Income Tax Ordinance, 2001 will help you ensure a smooth refund process.
🔍 Who Can Claim a Tax Refund?
A taxpayer is eligible for a refund if:
• You have paid tax in excess of what is properly chargeable under the law.
• You repaid an advance or loan treated as dividend under the Ordinance and paid tax on it (as per subsection 1A).
📝 How to Apply for a Refund
To claim your refund:
1. Submit an application in the prescribed form.
2. Ensure the application is verified in the prescribed manner.
3. File the application within three years from the later of:
o The date of the assessment order for the relevant tax year, or
o The date the tax was paid.
💡 Commissioner’s Role
The Commissioner will:
• Adjust excess tax against any other tax liability you may have.
• Apply remaining excess against outstanding liabilities.
• Refund the balance, if any, directly to the taxpayer.
The Commissioner is required to issue a written decision within 60 days of receiving your application and provide an opportunity for you to be heard.
⚖ Appealing Decisions
If you are dissatisfied with the decision or the Commissioner fails to issue a decision within 60 days, you can file an appeal under Part III of the Income Tax Ordinance.
💻 Modern Refund Processing
The FBR may implement rules for expedited or automatic refund payments via a centralized processing system, ensuring faster and more transparent disbursement of refunds.
✅ Key Takeaways
• Refunds are available if you overpaid tax.
• Applications must follow the prescribed procedure and timelines.
• Excess tax may be adjusted against other liabilities or refunded directly.
• FBR may streamline refund processing for quicker payments.
By understanding Section 170 and keeping proper records, taxpayers can efficiently claim income tax refunds in 2026 without delays.
Disclaimer: This article is for informational purposes only and does not constitute professional tax advice. Taxpayers should consult the Federal Board of Revenue (FBR) or a qualified tax professional for guidance specific to their situation. Compliance with the Income Tax Ordinance, 2001 and any applicable rules and regulations is the responsibility of the taxpayer.