Minimum penalty Rs10,000 for failure in updating taxpayer profile

Minimum penalty Rs10,000 for failure in updating taxpayer profile

ISLAMABAD: A minimum penalty of Rs10,000 has been prescribed for one day after deadline for updating taxpayer profile under Section 114A of the Income Tax Ordinance, 2001.

The updating profile by a taxpayer has been mandatory through Finance Act, 2020. The last date for updating the profile is March 31, 2021.

According to Section 182 of Income Tax Ordinance, 2001 any person who is required to furnish or update a taxpayer’s profile but fails to furnish or update within due date then such a person shall pay a penalty of Rs2,500 for each day of default from the due date subject to a minimum penalty of Rs10,000.

According to the Section 114A:

Taxpayer’s profile.-(1) Subject to this Ordinance, the following persons shall furnish a profile, namely:-

(a) every person applying for registration under section 181;

(b) every person deriving income chargeable to tax under the head, “Income from business”;

(c) every person whose income is subject to final taxation;

(d) any non-profit organization as defined in clause (36) of section 2;

(e) any trust or welfare institution; or

(f) any other person prescribed by the Board.

(2) A taxpayer’s profile-

(a)shall be in the prescribed form and shall be accompanied by such annexures, statements or documents as may be prescribed;

(b) shall fully state, in the specified form and manner, the relevant particulars of –

(i) bank accounts;

(ii) utility connections;

(iii) business premises including all manufacturing, storage or retail outlets operated or leased by the taxpayer;

(iv) types of businesses; and

(v) such other information as may be prescribed;

(c) shall be signed by the person being an individual, or the person’s representative where section 172 applies; and

(d) shall be filed electronically on the web prescribed by the Board.

(3) A taxpayer’s profile shall be furnished,-

(a) on or before the 31st day of December, 2020 in case of a person registered under section 181 before the 30th day of September, 2020; and

(b) within ninety days registration in case of a person not registered under section 181 before the 30th day of September, 2020.

(4) A taxpayer’s profile shall be updated within ninety days of change in any of the relevant particulars of information as mentioned in clause (b) of sub-section (2).

Through Circular No. 08 of 2020, the FBR extended the date of furnishing of taxpayer’s profile from December 31, 2020 to March 31, 2021.

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