Karachi, October 19, 2024 – The Federal Board of Revenue (FBR) has provided a detailed explanation regarding the due dates for tax payment under the provisions of the Income Tax Ordinance (ITO), 2001. This clarification is aimed at ensuring taxpayers understand their obligations and comply with deadlines to avoid penalties or surcharges.
The FBR outlined the specifics of Section 137 of the Income Tax Ordinance, 2001, which governs the due dates for tax payments. According to the FBR’s clarification:
Tax on Taxable Income
Under subsection (1) of Section 137, any tax payable on a taxpayer’s taxable income for a given tax year is due on the same date as the deadline for filing the taxpayer’s income tax return for that year. This includes taxes payable under Sections 113 or 113A, which cover minimum tax and certain advance taxes, respectively.
Payment Following Assessment Orders
For taxes assessed through an order, amended assessment, or any other order issued by the Commissioner under the Ordinance, the FBR requires payment within 30 days of the service of the notice. This is explained in subsection (2). Once the notice is served, the amount specified must be paid within this period to avoid default. However, an exception applies to tax payable under subsection (7) of Section 147, which outlines the specific deadlines for advance tax payments.
Extension of Payment Deadlines
Subsection (4) allows taxpayers to request an extension of the payment deadline by submitting a written application to the Commissioner. If the taxpayer can demonstrate a reasonable cause, the Commissioner may grant either an extension or permission to pay the tax in installments. The installments may be of equal or varying amounts depending on the taxpayer’s circumstances.
However, taxpayers should note that defaulting on any installment will result in the immediate demand for the entire remaining balance, as per subsection (5).
Default Surcharge
Importantly, the granting of an extension or permission for installment payments does not exempt the taxpayer from incurring default surcharges. According to subsection (6), any surcharge under Section 205 will continue to accumulate from the original due date, regardless of any extension or installment arrangement.
This clarification by the FBR is intended to enhance compliance and reduce confusion regarding tax payments. Taxpayers are advised to carefully observe these deadlines to avoid penalties and surcharges that may arise from delays or defaults in payment.