ISLAMABAD: Persons, who fail to file their income tax return by due date, may be included into the Active Taxpayers List (ATL) after payment of surcharge.
Inclusion in ATL is mandatory to avail reduced rate of withholding tax. Through Finance Act, 2019 the rates of withholding tax have been increased 100 percent for those persons who have either failed to file annual return or filed return after due date.
This means only those individuals or companies will get ATL status who filed their annual income tax returns by due date.
The FBR said that a person’s name will be part of the current ATL, if the Tax Return filed pertains to the Tax year of the relevant ATL.
For example, to be part of the ATL published on 1st March 2018, a person must have filed a Tax return for the Tax year 2017.
Similarly, to be a part of the ATL published on 1st March 2019, a person must have filed a Tax Return for the Tax year 2018.
Restriction on including a person’s name on ATL, if the person has not filed Tax Return by the due date specified by Income tax authorities was introduced through Finance Act, 2018.
For example, to be part of the ATL published on 1st March 2019, a person must file a Tax Return by the specified due date for the Tax year 2018.
However, through Finance Act, 2019 a person’s name can be part of ATL, even if the person has filed Tax Return after the due date specified by Income Tax authorities.
Furthermore, a surcharge for placement on ATL after due date of filing of Tax Return will be charged as under:
Association of Persons: Rs10,000
The FBR said a that company or an AOP shall be included in the ATL, whose return is not to be filed due to incorporation or formation after 30th day of June relevant to the Tax year pertaining to the ATL.
Joint account holders as an entity shall be deemed to be part of ATL if any of the persons in the joint account have met the criteria of being included in the ATL.
Bank account held in the name of a minor shall be considered part of ATL if the parents, guardians of the minor or any person who has deposited money in minor’s account are deemed to have met the criteria of being included in the ATL.
The FBR said that the late filers of Income Tax Return for Tax Year 2018 can pay “Surcharge for ATL” as defined under section 182(A) of Income Tax Ordinance 2001 by clicking on Tax Payment Nature “Misc” head in the PSID.
Only after the payment of surcharge will the name of the late filer become part of ATL.