Procedure for obtaining sales tax registration

KARACHI: The Federal Board of Revenue (FBR) has introduced a streamlined procedure for sales tax registration, aiming to facilitate taxpayers engaged in making taxable supplies in Pakistan.

The move is part of the FBR’s ongoing efforts to enhance transparency, ease of compliance, and ensure a robust tax collection mechanism in the country.

Applicability of Sales Tax Registration

The revised procedure applies to taxpayers involved in making zero-rated supplies during the course or furtherance of any taxable activity. Individuals falling into specific categories, who are not already registered, are mandated to undergo the sales tax registration process as per the Sales Tax Act, 1990.

Sales Tax Registration Procedure

To initiate the sales tax registration process, the concerned individual or entity is required to follow the procedure outlined by the Federal Board of Revenue:

1. Electronic Submission: Applicants are instructed to electronically submit their applications through the efile portal in the relevant Regional Tax Office (RTO). It is essential to ensure that all columns of the forms are duly filled in accordance with the provided instructions.

2. Verification and Certification: Following the submission, the Regional Tax Office will conduct a verification process. Upon successful verification, a registration certificate bearing a unique registration number will be issued. The certificate will then be mailed to the registered person using a prescribed form.

3. Verification Authority: While the Regional Tax Office typically verifies the application contents using its available data, it retains the authority to initiate an enquiry through the Registration Office to cross-verify the declaration’s accuracy. In the event of rejection, the office has fifteen days from the application’s receipt date to communicate the rejection reasons to the applicant.

Information Required for Registration

To streamline the registration process, the FBR has outlined specific information that applicants must provide:

I. Complete Business Name:

• Clearly specifying the business name.

II. Business Nature and Activity or Service:

• Clearly defining the business’s main activity or service.

III. Complete Address Details:

• Providing the complete address of the head office, all business units, go downs, outlets, along with contact details such as phone numbers, fax, email, electricity and gas consumer numbers.

IV. Bank Account Information:

• Furnishing all bank account numbers along with the respective names and addresses.

V. NTN (National Tax Number) and NIC (National Identity Card Number):

• Providing NTN and NIC details of the owner, partners, or directors of the business. In the case of foreigners, passport numbers are required.

VI. Company Information:

• For companies, registration number and date of incorporation.

VII. AOP Members:

• Every director or member of an Association of Persons (AOP) is required to fill in the form.

VIII. Commencement of Business:

• Indicating the date of business commencement and the initial capital employed.

IX. Business Records Maintenance:

• Detailing the mode of maintaining business records.

This streamlined sales tax registration procedure not only ensures compliance with tax regulations but also promotes transparency in the business environment. By leveraging electronic submission and verification processes, the FBR aims to make the registration process more efficient and accessible for taxpayers across the country.