Karachi, October 29, 2025 – Just two days before the tax return filing deadline, the Karachi Tax Bar Association (KTBA) has once again raised the alarm over what it calls a “serious and unlawful tax calculation error” in the Federal Board of Revenue’s (FBR) IRIS online filing portal — a glitch that could potentially impact thousands of taxpayers across Pakistan.
It is pertinent to mention that the return filing deadline for tax year 2025 is October 31, which was already extended twice for current return filing season.
In a strongly worded letter addressed to FBR Chairman Rashid Mahmood Langrial, KTBA President Ali A. Rahim highlighted that despite repeated reminders, the system continues to wrongly impose surcharge under Section 4AB on the share income of members of Associations of Persons (AOPs) — a clear violation of Section 92 of the Income Tax Ordinance, 2001.
According to KTBA, income shared by AOP members is legally exempt from additional taxation, even if it exceeds PKR 10 million. However, the IRIS system’s incorrect configuration has been generating inflated and unlawful tax demands, creating massive confusion and hardship for compliant taxpayers.
“This issue was raised months ago, yet the FBR’s technical team has failed to rectify it,” the letter stated, adding that such negligence undermines public confidence in the fairness and credibility of the country’s digital tax filing system.
The KTBA urged the FBR to take immediate corrective action, directing the technical team to fix the computation logic and ensure that the portal aligns with legal provisions.
With the October 31 filing deadline fast approaching, tax experts warn that this software blunder could disrupt thousands of return submissions, further straining the already burdened tax filing process.