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Tag: Active Taxpayers List

Active Taxpayers List is an official database of tax filers in Pakistan, maintained by FBR, offering benefits like reduced tax rates and compliance status.

  • Finance Bill 2019: Money withheld of persons not appearing on ATL to be treated as unexplained

    Finance Bill 2019: Money withheld of persons not appearing on ATL to be treated as unexplained

    ISLAMABAD: The government has taken harsh stance against persons having taxable income but not on the tax roll.

    In this regard the law has been introduced under which persons not appearing on the Active Taxpayers List (ATL) and their amount withheld on transactions will be treated as unexplained.

    Commissioners of Inland Revenue, Federal Board of Revenue (FBR) have been empowered to make assessment of income of such persons and issue notices.

    A budget commentary issued by EY Ford Rhodes Chartered Accountants said that the concept of filers and non-filers was introduced in the Ordinance through the Finance Act, 2014.

    Through this concept a distinction was created between person who duly filed their tax returns and the remaining persons who were considered non-filers.

    The basic intention of the legislature was to obtain documentation and compel the non-filers to become registered tax filers.

    Over the years, major distinction was introduced in the rates of tax withholding under various sections of the Ordinance to make the non-filers suffer heavy withholding of tax so that they may be compelled to ultimately come within the tax net and file proper declaration of their tax returns with FBR.

    However, over the last five years, it has been observed that the percentage of increase in tax filers has not been significant and the numbers of tax filers is still quite low as compared to other comparable economies.

    The present government has been talking about broadening of the tax base more strongly and the Prime Minister himself has on many occasions indicated his strong desire to significantly broaden the tax base.

    It is now proposed to enact a separate schedule in the Ordinance to deal with persons who are not on the ATL i.e. who are not in the tax net and are not filing their declaration so far.

    In this connection, Section 100BA has been proposed which governs the collection or deduction of advance income tax, computation of income and tax payable by such persons.

    The Tenth Schedule generally provides that where ever tax is required to be deducted or collected under any provisions of the Ordinance from a person whose name is not appearing in the ATL, the rate of withholding will be doubled in case of deduction or collection from such persons.

    However, the schedule provides exception in case of the following payments –

    (1) Salary;

    (2) Payment to non-residents other than on account of royalty, fees for technical service, insurance premium

    (3) Payment to a Permanent Establishment in Pakistan of a non-resident person other than on account of providing services or contract or any general payment to a non-resident.

    (4) Payment on account of exports

    (5) Tax deductions from payment of rent

    (6) Tax deductions from withdrawal of balance from pension funds

    (7) Tax collection from cash withdrawal from a bank

    (8) Tax collection on banking transactions

    (9) Collection of tax by NCCPL

    (10) Collection of tax on domestic or commercial electricity consumption

    (11) Tax collection from steel melters

    (12) Purchase of air tickets

    (13) Functions and gatherings

    (14) Cable operators

    (15) Educational institutions

    (16) Dealers and commission agents

    (17) Purchase of international air tickets

    (18) Non-cash banking transactions

    (19) Payment for use of machinery and equipment

    (20) Remittance of education related expenses

    (21) Extractions of minerals

    (22) Tobacco

    The Schedule seeks to provide a mechanism where a withholding agent is satisfied that the person not appearing in the ATL is not required to be a tax filer and hence the deduction of tax should not be attracted from payments to such persons.

    In such a situation, the payer would be required to furnish an application to the Commissioner in writing electronically providing the details of the person from whom he intends not to collect tax, giving details about the payee and the nature of payment and the basis on which he is not liable to be a tax filer.

    The Commissioner on such application would decide the matter within 30 days and direct the payer accordingly.

    Assessment of such person

    — The Schedule requires the Commissioner to undertake a provisional assessment of the person from whom tax has been withheld under the Schedule but he has failed to file the return of income within the prescribed time or extended time.

    — The provisional assessment is proposed to be carried out within 60 days of the due date of filing of return. The income of such person in such a case shall be imputed on the basis of tax that has been withheld at source and shall be treated as un-explained income.

    — Once the provisional assessment has been finalized and served on such person, he can file a return of income within 45 days of the service of the provisional order. In which case the provisional assessment shall stands abated.

    — If a return of income is not filed within 45 days of service of order of provisional assessment, then such assessment is to be treated as final assessment order. In such a case the Commissioner is also proposed to be empowered to pass an order within 30 days of finalization of assessment for imposition of penalty on account of non-furnishing of return and concealment of income.

    — The Schedule also seeks to empower the Commissioner to amend an assessment on the basis of definite information from an audit or otherwise.

    Consequent to the proposed enactment of the Schedule, to withdraw concept of filers and non-filers from various provisions of the Ordinance, several amendments have been proposed in various withholding provisions to remove reference to Filer and non-Filer.

    Similarly the restrictions introduced on purchase of immovable property and moveable property on Non-filers in Section 227C are also proposed to be abolished.

  • Finance Bill 2019: late filer salary persons allowed ATL entry

    Finance Bill 2019: late filer salary persons allowed ATL entry

    ISLAMABAD: The government has allowed late filers to include Active Taxpayers List (ATL) after payment of penalty. Presently, as per law the late filers are not allowed to ATL entry till next tax year.

    The government has proposed this relaxation through Finance Bill, 2019 as part of budget 2019/2020. The payment of penalty has been fixed Rs20,000 for companies, Rs10,000 for Association of Persons (AOPs), Rs3,000 for non-salaried persons and Rs1,000 for salaried persons.

    The Federal Board of Revenue (FBR) while explaining the Finance Bill, 2019, said presently law prohibits placing a person’s name on the ATL for the year if the return is not filed within the due date.

    Hence, a person who files a return of income after the due date would be subjected to higher tax rates meant for persons not appearing on ATL, for the ensuing year, creating a disincentive towards return filing.

    “The condition of not placing name on ATL for the whole year is being abolished.”

    Instead, such a person would be penalized by withholding any refund due to a late-filer in the tax year in which the return was filed late without incurring any liability of compensation for delayed refund.

    Further, a nominal tax for placement on ATL after the due date of filing of return has been imposed as under:-

    1. Company Rs. 20,000

    2. Association of persons Rs. 10,000

    3. Non-salaried individuals Rs. 3,000

    4. Salaried individuals Rs. 1,000

  • Income Tax Ordinance 2001: Late filers not to get names on ATL

    Income Tax Ordinance 2001: Late filers not to get names on ATL

    KARACHI: Late filers of income tax returns will not get their name on the Active Taxpayers List (ATL) that will be issued tomorrow (March 01, 2019).

    The Federal Board of Revenue (FBR) will issue the latest edition of ATL, which will carry names of those taxpayers who filed their income tax returns by due date for Tax Year 2018.

    With the issuance of new active taxpayers’ list the FBR will also suspend the weekly updated list as the late filers have been denied to have their names on the list.

    The previous PML-N government in its last budget announcement made a law to restrict the list with those name, who filed their list by due date.

    Through Finance Act, 2018 a new provision Section 182A was added to Income Tax Ordinance, 2001 for this purpose.

    Section 182A: Return not filed within due date.—

    Sub-Section (1): Notwithstanding anything contained in this Ordinance, where a person fails to file a return of income under section 114 by the due date as specified in section 118 or by the date as extended by the Board under section 214A or extended by the Commissioner under section 119, as the case may be, such person shall—

    (a) not be included in the active taxpayers’ list for the year for which return was not filed within the due date; and

    “Explanation.—For the removal of doubt it is clarified that the provisions of this section shall apply from tax year 2018 and onwards for which the first Active Taxpayers List is to be issued on first day of March, 2019 under Income Tax Rules, 2002.; and

    (b) not be allowed, for that tax year, to carry forward any loss under Part VIII of Chapter IV.

    The FBR issued its last weekly updated ATL for Tax Year 2017 on Monday, February 25, 2019, which carried those taxpayers list who filed their returns up to February 24, 2019.

    The last ATL shows the FBR received 1.84 million returns till February 24, 2019 for tax year 2017.

    While, the FBR received around 1.55 million income tax returns for tax year 2018 by due dates for individuals and corporate entities.

    The appearance on ATL is important for a taxpayer to avail reduced rate of withholding tax rates.

    The appearance of name has become even more important after the amendments brought in to restrict non-filers in purchase / registering new motor vehicles and immovable properties.

  • FBR explains inclusion into ATL for availing tax benefits

    FBR explains inclusion into ATL for availing tax benefits

    ISLAMABAD: Federal Board of Revenue (FBR) has explained the inclusion into Active Taxpayers List (ATL) for availing reduced rates of withholding tax and other benefits.

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  • FBR gets 1.81 million active taxpayers for 2017

    FBR gets 1.81 million active taxpayers for 2017

    The Federal Board of Revenue (FBR) has reported a noteworthy surge in the total number of active taxpayers, reaching 1.81 million for the tax year 2017, according to the latest Active Taxpayers List (ATL) released on a weekly basis.

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  • Active taxpayers number surpasses 1.8 million for tax year 2017

    Active taxpayers number surpasses 1.8 million for tax year 2017

    KARACHI, [Date] – In a significant milestone for Pakistan’s tax revenue collection, the number of active taxpayers has exceeded 1.8 million for the tax year 2017, as reported in the latest weekly Active Taxpayers List (ATL) released by the Federal Board of Revenue (FBR).

    The FBR sources have confirmed that the total number of active taxpayers for Tax Year 2017 now stands at 1.801 million, with the ATL 2017 remaining applicable until February 28, 2019.

    The appearance of a taxpayer’s name on the ATL is mandatory for individuals and entities seeking to benefit from reduced rates of withholding tax. This achievement reflects the FBR’s concerted efforts to encourage tax compliance and expand the tax base.

    The FBR had set an ambitious target of reaching 1.8 million active taxpayers for the tax year 2017, a goal that has been successfully attained. Throughout the year, the FBR dedicated its resources and machinery to engage with both existing and potential taxpayers, urging them to file their income tax returns.

    Sources within the FBR revealed that taxpayers who missed the deadline for filing their returns for the tax year 2017 are still in the process of submitting their returns and gaining inclusion in the ATL. However, it’s important to note that this practice will not be allowed for the tax year 2018.

    The government, through the Finance Act of 2018, introduced an amendment to the Income Tax Ordinance, 2001, and created Section 182A. This amendment stipulated that late filers would not be treated as filers or active taxpayers. Consequently, the FBR received a total of 1.55 million returns for the tax year 2018, which will be the final count for the ATL 2018, set to be released on March 1, 2019.

    Despite the initially strict stance, sources within the FBR have indicated that the government is considering allowing late filers to submit their returns and have their names added to the ATL. This reconsideration recognizes the practical challenges and circumstances faced by late filers and aims to facilitate tax compliance while expanding the tax base.

    The achievement of surpassing 1.8 million active taxpayers for the tax year 2017 demonstrates the success of the FBR’s proactive efforts to encourage tax compliance and boost the government’s revenue collection. The ATL remains a valuable tool for promoting tax transparency and ensuring that eligible taxpayers benefit from reduced withholding tax rates.

    It is important to underline that tax compliance is essential for the sustainable growth and development of Pakistan’s economy. A broad tax base ensures that resources are available for critical public services and infrastructure development, ultimately benefiting the nation as a whole.

    As the government considers the possibility of allowing late filers for the tax year 2018, it underscores its commitment to promoting tax compliance while understanding the practical challenges faced by taxpayers. This flexibility is expected to further enhance the tax collection process and contribute to Pakistan’s fiscal stability.

  • Late return filers may be allowed entry into ATL

    Late return filers may be allowed entry into ATL

    Late return filers of income tax may soon have the opportunity to be included in the Active Taxpayers List (ATL) following proposed amendments to tax laws.

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