New filing rules extend tax return obligation to property owners, vehicle owners, registered professionals and other specified taxpayers.
ISLAMABAD: The Federal Board of Revenue (FBR) has significantly expanded the scope of mandatory income tax return filing for Tax Year (TY) 2026, requiring a broad range of individuals, companies, associations and organisations to submit annual income tax returns under Section 114 of the Income Tax Ordinance, 2001.
The filing obligation now extends beyond taxpayers with taxable income to include property owners, vehicle owners, registered professionals, businesspersons and individuals meeting specified economic criteria, as part of the government’s drive to broaden the tax base and improve documentation of the economy.
Companies and Organisations Required to File
Under Section 114 of the Income Tax Ordinance, 2001, the following entities are required to file an income tax return for Tax Year 2026:
• Every company.
• Every non-profit organisation as defined under Section 2(36).
• Every person whose income is subject to final taxation under any provision of the Income Tax Ordinance.
Individuals with Taxable Income
Every individual, other than a company, whose taxable income exceeds the maximum amount not chargeable to tax during the tax year is also required to submit an income tax return.
Other Persons Required to Submit Returns
The law also makes return filing compulsory for individuals who may not otherwise fall within the taxable income threshold but satisfy certain economic or regulatory conditions.
A return must be filed by any person who:
• Was charged to tax in either of the preceding two tax years.
• Claims a carried-forward tax loss.
• Owns immovable property with a land area of 500 square yards or more.
• Owns a flat within municipal limits, cantonment areas or the Islamabad Capital Territory.
• Owns immovable property measuring 500 square yards or more located in a rating area.
• Owns a flat measuring 2,000 square feet or more in a rating area.
• Owns a motor vehicle with an engine capacity exceeding 1,000cc.
• Has obtained a National Tax Number (NTN).
• Holds a commercial or industrial electricity connection with an annual electricity bill exceeding Rs500,000.
• Is a resident person registered with a chamber of commerce and industry, trade or business association, market committee or recognised professional body.
• Is a resident individual required to submit a foreign income and assets statement under Section 116A.
• Falls within any class of persons notified by the FBR with the approval of the Federal Minister for Finance.
Registered Professionals Covered
The mandatory filing requirement also applies to resident persons registered with recognised professional bodies, including:
• Pakistan Engineering Council (PEC).
• Pakistan Medical and Dental Council (PMDC).
• Pakistan Bar Council and Provincial Bar Councils.
• Institute of Chartered Accountants of Pakistan (ICAP).
• Institute of Cost and Management Accountants of Pakistan (ICMAP).
Business Income Threshold
The law further requires every individual whose income under the head “Income from Business” exceeds Rs300,000 but does not exceed Rs400,000 during the tax year to furnish an income tax return.
Income Tax Return Deadlines
According to the FBR, the filing deadlines for Tax Year 2026 are:
September 30, 2026 for:
• Salaried individuals.
• Business individuals.
• Associations of Persons (AOPs).
• Companies having a special tax year.
December 31, 2026 for:
• Companies following the normal financial year ending June 30.
Drive to Expand Tax Documentation
The expanded mandatory filing requirements form part of the FBR’s ongoing strategy to strengthen tax compliance and widen Pakistan’s tax base. By requiring tax returns from property owners, vehicle owners, registered professionals and individuals with significant economic activity, the revenue authority aims to improve documentation of the economy, enhance voluntary compliance and increase the number of active taxpayers.