The Federal Board of Revenue (FBR) issued paper income tax return forms for tax year 2021 on Friday, just a month ahead of the looming filing deadline of September 30, 2021.
The issuance of SRO 1073(I)/2021 formally notified the paper return form applicable to individuals and Association of Persons (AOPs) for the upcoming tax year.
Traditionally, taxpayers have been encouraged to file their income tax returns electronically, and the FBR had already notified the electronic income tax return form for tax year 2021 through SRO 853(I)/2021 dated July 01, 2021. This digital approach aimed at streamlining the filing process for various categories of taxpayers, including salaried individuals, business owners, associations of persons, and companies.
However, the latest move by the FBR to release paper income tax return forms through SRO 1073(I)/2021 has sparked discussions within the tax community. Some tax experts argue that providing taxpayers with only one month to comply with the statutory requirement of filing returns, especially through the traditional paper-based method, may not be justified.
It is worth noting that the FBR had previously released draft paper income tax return forms through SRO 1022(I)/2021 on August 16, 2021. The subsequent release of the finalized paper forms, just a month before the deadline, has left taxpayers and practitioners with limited time to adapt to the new requirements.
The FBR’s decision to provide a paper-based option raises questions about the reasoning behind such a move, especially considering the ongoing push towards digitization and electronic filing. While the electronic system offers efficiency and ease of access, the simultaneous release of paper forms suggests a parallel effort to cater to those who may still prefer the traditional method of filing returns.
In response to the situation, tax experts are urging the FBR to consider a more balanced approach, providing sufficient time for taxpayers to transition to the updated filing requirements. Additionally, they emphasize the need for clear communication and guidance to ensure a smooth and hassle-free experience for those choosing either the electronic or paper filing methods.
As the September 30 deadline approaches, taxpayers are advised to carefully review the options available to them, taking into account the new paper forms and the existing electronic filing system. The FBR’s move underscores the evolving landscape of tax administration and the ongoing efforts to strike a balance between modernization and accommodating various preferences within the taxpayer community.
