ISLAMABAD: The Federal Board of Revenue (FBR) has granted enhanced powers to Inland Revenue (IR) officers to closely monitor transactions conducted by jewelers, real estate agents, and accountants in an effort to curb money laundering activities.
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FBR, Pakistan’s national tax collecting agency, plays a crucial role in the country’s economy. Pakistan Revenue is committed to providing readers with the latest updates and developments regarding FBR activities.
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FBR constitutes refund resolution committees for Punjab taxpayers
ISLAMABAD: Federal Board of Revenue (FBR) on Tuesday constituted complaint resolution committees for settlement of issues relating to sales tax refund matters for the taxpayers in the province of Punjab.
The FBR constituted two complaint resolution committees for Punjab North and Punjab South.
The complaint resolution committee Punjab (South) shall comprise following members for settlement of sales tax refund issues of taxpayers falling under the jurisdiction of field formation of Multan, Bhawalpur and Sahiwal:
Rehman Naseem, ex-Senior Vice Chairman, All Pakistan Textile Mills Association: Convener
Chief Commissioner Inland Revenue, Large Taxpayers Office (LTO), Multan: Member
Chief Commissioner-IR, Regional Taxpayers Office (RTO), Multan: Member
Filza Mumtaz, CEO, SHAHS and WEEN, ex-president, Women Chamber of Commerce and Industry (WCCI), Multan: Member
Khawaja Anees, Director Mahmood Group of Companies, Multan: Member
Additional Commissioner (HQ), LTO, Multan: Member/Secretary
The complaint resolution committee Punjab (North) shall comprise following members for settlement of sales tax refund issues of taxpayers falling under the jurisdiction of field formations of Lahore, Faisalabad, Gujranwala, Sargodha and Sialkot:
Gohar Ejaz, Patron In Chief, APTMA Lahore: Convener
Chief Commissioner-IR, RTO, Lahore: Member
Dr. Quratul Ain Irfan, Vice President, Pacific Pharmaceuticals, Lahore, Member
Almas Hyder, Former President, Lahore Chamber of Commerce and Industry (LCCI), Lahore: Member
Mohammad Raza Baqir, Executive Director, APTMA Lahore, Member
Additional Commissioner (HQ) RTO, Lahore: Member/Secretary
Terms of Reference (TOR) of the complaint resolution committees are as under:
(i) Review the nature of complaints/issues possible solution and take immediate action for resolution;
(ii) Follow up with concerned field formations till issue is resolved;
(iii) Maintain complete record of complaints/issues, mechanism adopted for resolution and post resolution action required, if any; and
(iv) Share date with FBR on monthly basis indicating issues received, issues resolved and issues pending for resolution and reasons for pendency.
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FBR launches crackdown against non-filers; fine, penalty imposed
ISLAMABAD: Federal Board of Revenue (FBR) on Monday launched crackdown against non-filers of income tax returns for tax year 2020.
Taxpayers including salaried persons, business individuals, Association of Persons and corporate entities, who were required to file their returns by due date i.e. September 30, 2020 extended up to December 08, 2020, have received notices of non-compliance.
The taxpayers have received notices to file their returns for tax year 2020 along with payment of fine and penalty.
The FBR issued the finalized return form for tax year 2020 on September 08, 2020 for which the last date was September 30, 2020. Tax bars of the country advised the FBR that taxpayers should be given 90 days for filing returns as per statute.
Therefore, the FBR extended the date up to December 08, 2020 in one go and made it clear that no further date extension would be granted.
The FBR by December 08, 2020 and received around 1.8 million income tax returns for tax year 2020. Further, around 300,000 taxpayers got date extension after filing applications on the last date.
It means that the number of return filers, who made compliance of the due date, reaches to around 2.1 million for tax year 2020. It means a large number of taxpayers are required to file their returns with payment of fine and penalty.
Following is the Section 182 of Income Tax Ordinance, 2001 under which fine and penalty would be imposed on non-compliant taxpayers:
Under Section 182:
Where any person fails to furnish a return of income as required under section 114 within the due date.
Such person shall pay a penalty equal to 0.1% of the tax payable in respect of that tax year for each day of default subject to a maximum penalty of 50% of the tax payable provided that if the penalty worked out as aforesaid is less than forty thousand rupees or no tax is payable for that tax year such person shall pay a penalty of forty thousand rupees:
Provided that If seventy-five percent of the income is from salary and the amount of income under salary is less than five million Rupees, the minimum amount of penalty shall be five thousand Rupees.
Where any person fails to furnish wealth statement or wealth reconciliation statement then such person shall pay a penalty of 0.1% of the taxable income per week or Rs.100,000 whichever is higher.
The late filers will also require to pay a fee for appearance in Active Taxpayers List (ATL) for tax year 2020, which will be issued on March 01, 2021.
Section 182A. Return not filed within due date.—(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:
Provided that without prejudice to any other liability under this Ordinance, the person shall be included in the active taxpayer ‘ list on filing return after the due date, if the person pays surcharge at Rupees-
(i) twenty thousand in case of a company;
(ii) ten thousand in case of an association of persons;
(iii) one thousand in case of an individual.
Persons fail to comply with filing requirement can face harsh action including imprisonment.
Section 191. Prosecution for non-compliance with certain statutory obligations. —(1) Any person who, without reasonable excuse, fails to —
(a) comply with a notice under sub-section (3)and sub-section (4) of section 114 or sub-section (1) of section 116; shall commit an offence punishable on conviction with a fine or imprisonment for a term not exceeding one year, or both.
(2) If a person convicted of an offence under clause (a) of sub-section (1) fails, without reasonable excuse, to furnish the return of income or wealth statement to which the offence relates within the period specified by the Court, the person shall commit a further offence punishable on conviction with a fine not exceeding fifty thousand rupees or imprisonment for a term not exceeding two years, or both.
Section 192: Prosecution for false statement in verification. — Any person who makes a statement in any verification in any return or other document furnished under this Ordinance which is false and which the person knows or believes to be false, or does not believe to be true, the person shall commit an offence punishable on conviction with a fine upto hundred thousand rupees or imprisonment for a term not exceeding three years, or both.
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FBR’s online return filing portal restores after disruption
KARACHI: The online return filing portal of Federal Board of Revenue (FBR) restored after witnessing disruption on Monday.
The IRIS – the online web portal of the FBR for income tax return filing – is working normally by Monday evening after taxpayers complained that the portal was not responding during first half.
The portal was experiencing outage till noon on Monday.
Earlier, in the day a large number of taxpayers unable to file their annual income tax returns on Monday as the official web portal of the FBR was not responding.
The official website of the FBR https://www.fbr.gov.pk was responding very slowly. Further, the IRIS portal – the return filing portal – is showing different massage – including internal server errors.
Tax practitioners said that last night the portal was responding well and they had filed returns of their clients. However, from Monday morning till noon the IRIS portal https://iris.fbr.gov.pk/infosys/public/txplogin.xhtml was not responding. However, in some cases it opens but with slow response.
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FBR’s return filing portal not responding
KARACHI: A large number of taxpayers unable to file their annual income tax returns on Monday as the official web portal of the Federal Board of Revenue (FBR) is not responding.
The official website of the FBR https://www.fbr.gov.pk is responding very slowly. Further, the IRIS portal – the return filing portal – is showing different massage – including internal server errors.
Tax practitioners said that last night the portal was responding well and they had filed returns of their clients. However, from Monday morning till filing of this news item the IRIS portal https://iris.fbr.gov.pk/infosys/public/txplogin.xhtml was not responding. However, in some cases it opens but with slow response.
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Return filing date extended up to December 24
ISLAMABAD: Federal Board of Revenue (FBR) has granted date extension up to December 24, 2020 for filing annual income tax return to those taxpayers who submitted applications under Section 119 of Income Tax Ordinance, 2001.
The last date for filing income tax return was expired on December 08, 2020. The FBR refused to grant general extension but allowed the taxpayers to file an application to commissioners having jurisdiction for seeking extension.
The FBR directed commissioners of Inland Revenue to grant extension to all those taxpayers filed application i.e. online or manual by mid-night December 08, 2020. However, persons, who submitted application by December 10, 2020, have received approval on December 12, 2020 under Section 119(3) of Income Tax Ordinance, 2001 for filing their returns.
The FBR received around 1.8 million tax returns for tax year 2020 by December 20, 2020. However, the FBR said that it had received about 300,000 applications for extension which would make the tally at 2.1 million for tax year 2020.
Tax experts however believed that the number is remained very low as compared with the previous tax year. The FBR received around 2.98 million for tax year 2019 by December 06, 2020.
They said that many taxpayers had failed to file their returns due to system glitches. They said that despite directives of the FBR for allowing extension on submission of applications, many taxpayers were unaware about the procedure of submitting the applications.
The experts said that the FBR should allow a general date extension to all the taxpayers, who were required to file return under the law but failed to make compliance by due date.
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Annual tax return filing by due date falls 29 percent
ISLAMABAD: Filing of annual income tax returns fell by 29 percent for tax year 2020 by due date as compared with number of return filed by due date for tax year 2019.
The FBR on Wednesday said that it had received around 1.8 million income tax returns for tax year 2020 by the due date i.e. December 08, 2020, which was extended from September 30, 2020. Since the FBR has refused to further extend the date so December 08, 2020 has been taken as the closing date for filing income tax returns for tax year 2020 without fine and penalty.
The FBR received 2.53 million returns by due date i.e. February 28, 2020, which was extended from September 30, 2019 to October 31, 2019, then November 30, 2019, then December 16, 2019, then December 31, 2019, then January 31, 2020 and final extension granted up to February 28, 2020.
The number of 2.53 million returns has been shown on the Active Taxpayers List (ATL) for tax year 2019 issued on March 01, 2020.
Around 2.98 million returns for tax year 2019 have been filed till December 06, 2020 as shown in the updated weekly ATL issued on December 07, 2020.
The latest number of returns filed for tax year 2020 has shown that it was around 39.6 percent or 1.18 million returns short when compared with latest ATL for tax year 2019.
On the other hand the FBR on Wednesday said that it had received 1.8 million tax returns for tax year 2020 by the last date i.e. December 08, 2020 as compared with 1.73 million returns received on the same date last year, showing 4 percent growth. However, the FBR said that around 300,000 taxpayers had submitted applications for date extension by the due date. This number will also add to the total number of returns filed for tax year 2020.
It is worth mentioning that the due date for filing income tax returns for tax year 2019 was extended up to February 28, 2020.
Further, since the launch of ATL on March 01, 2020 or the due date of February 28, 2020 for tax year 2019 the FBR received another 450,000 returns for the same year up to December 06, 2020.
The FBR through its press release said that its decision of not extending the date beyond December 08, 2020 was right. The decision for not extending the last date was taken to ensure discipline in return filing by due date.
However, collection of tax with return has shown significant increase. The FBR said that collection with return increased to Rs22 billion by the due date i.e. December 08, 2020, was 63 percent higher when compared with Rs13.5 billion by the same date of the last fiscal year.
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Electronic tax appeal filing made mandatory from January 01
The Federal Board of Revenue (FBR) has made the filing of tax appeals mandatory through electronic means, effective from January 1, 2021. This shift to electronic filing aims to streamline the process and reduce the administrative burden on taxpayers and tax authorities alike.
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FBR finalizes return form for small manufacturers after filing expiry date
ISLAMABAD: Federal Board of Revenue (FBR) on Wednesday issued a simplified single-page income tax return form for small manufacturers a day after when the last date for filing income tax return was expired.
The FBR issued SRO 1316(I)/2020 dated December 09, 2020 to notify the simplified income tax return form for individuals and Association of Persons (AOPs) having annual turnover less than Rs50 million.
Previously, the FBR issued the draft of this form on November 26, 2020 through SRO 1261(I)/2020 for seeking feedback from stakeholders.
The FBR issued the finalized return form for the small manufacturers for tax year 2020. Interestingly, the date for tax year 2020 has been expired on December 08, 2020 except for the corporate units which have due date for return filing till December 31, 2020.
So far the date for return filing was not further extended beyond December 08, 2020. But it is strong believe that the date may be extended to allow small manufacturers to file return under the newly notified return form.
Tax experts said that the FBR may not allow date extension for small manufacturers without extending the date for all taxpayers who have last return filing date on September 30 and extended up to December 08, 2020.
They said that the FBR had allowed general extension in date for filing tax return at the time of tax amnesty in the past.
The simplified return form of income has been issued for small scale manufacturers having turnover less than Rs50 million. A single page draft wealth statement form is also issued along with the draft return of income.
In the draft return form, the manufacturers would be required to provide limited information about their earnings and expenditures during a year.
The details, as per draft return of income, to be provided by the manufacturers are included: gross sale excluding sales tax and federal excise duty; cost of sales; opening stock; purchases (domestic/imports); closing stock; other direct expenses; gross profit; profit and loss expenses; total income; tax chargeable; tax payable; tax already paid through utility bills; net tax payable/refund etc.
Similarly, the taxpayer shall require to provide details, as per draft wealth statement form, are included: immovable assets; manufacturing unit; moveable assets; business capital; investment/advance; cash in hand/bank; loan/liabilities; net assets; reconciliation of net assets; net assets current year; net assets previous year; increase/decrease in net assets; income as per return; other inflows (gift, loan, remittances, etc.); outflows (gift, loan etc.); and personal expenses.
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Date for filing income tax returns may be extended
ISLAMABAD: The government may announce an extension in last date for filing return of income and wealth statement for tax year 2020, sources said.
Today i.e. Tuesday December 08, 2020 is the last date for filing income tax returns for tax year 2020. As per Income Tax Ordinance, 2001 the last date for filing tax return is September 30. However, this year the income tax return form was finalized on September 08, 2020 and as per law taxpayers should be provided statutory time limit of 90 days. Therefore, the Federal Board of Revenue (FBR) on the demand of tax bars and other stakeholders, extended the date by 90 days in one go.
This 90-day period is expiring today and the FBR has made it clear that it will not further extend the date as statutory time limit had already been granted.
Tax bars and business community are continuously pressing the tax authorities to extend the date as online portal IRIS was making miscalculation.
The sources in FBR said it was agreed at the Board level that the deadline would not be extended further in order to stop the tradition of repeated extension and to ensure compliance by due date.
However, they said that the stakeholders including business community had approached the Prime Minister through the advisor on finance to intervene and allow a reasonable time for filing the annual return.
A large number of returns have already been filed on the FBR portal, especially the salaried persons conveniently filed their returns through wizard based application. To some estimates around half of the returns filers, who filed their returns for tax year 2020, has made compliance by evening of Monday December 07, 2020.
Therefore, to accommodate a number of around 1.5 million on the last date is impossible. The FBR issued instructions to the field offices to facilitate the taxpayers seeking date extension through commissioner approval. Further, the FBR also allowed extension to many taxpayers through one application.
Tax experts said that the date extension through commissioner approval was already available in the Income Tax Ordinance, 2001 and by this way this issue may not be resolved and there is need to allow general relaxation in timing.
One of the major issues creating hurdles is significant increase in coronavirus cases. Due to resurgence of COVID the government and private sector have already slashed the work force to the half. In this scenario the return filing process through tax consultants/practitioners and third party filing may be affected.
Pakistan Tax Bar Association (PTBA) in its letter on December 02, 2020 urged the tax authorities to extend the last date for filing income tax returns up to January 31, 2020 after considering the significant rise in coronavirus cases in the country.
Many other issued highlighted by taxpayers and other stakeholders including calculation errors on the IRIS portal. The FBR sources said that these issues were discussed and most of those were resolved.
The sources said that extension in date may be announced later today evening.