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Get the latest FBR news, tax updates, income tax, sales tax, customs, notifications, and policies from the Federal Board of Revenue.

FBR gets information of property transactions

KARACHI: Federal Board of Revenue (FBR) has received information of buyers and sellers of immovable properties during the period July – December 2019, sources said.

The sources in tax offices told PkRevenue.com that bulk of information was provided by provincial property registrar offices and housing societies along with complete details of buyers and purchasers.

The sources said that the information would be used for detecting concealment of tax money and quantum of black money used in transactions.

The sources said that there was huge gap between values of property declared at the time of registration or transfer with fair market values.

They said that the property registrar offices and housing societies on behalf of the FBR collect withholding tax and deposit the same into the national kitty. Besides, working as withholding agents they also require to provide information of buyers and sellers under Section 165 of Income Tax Ordinance, 2001.

The withholding agents under Section 165 are require to obtain information of persons making transactions such as: name, Computerized National Identity Card Number (CNIC), National Tax Number (NTN), and address of each person from whom tax was collected or to whom payments were made from which tax was deducted.

As per law the withholding agents are required to provide details of all transactions and persons involved to the FBR by January 31, 2020 for the period July – December 2019.

The sources said that the withholding agents require to collect withholding tax from seller under Section 236C and from buyers under Section 236K of the Ordinance.

They said that in scrutiny process on the basis of information the tax offices would ask banks to provide payments details of buyers and sellers to identify the actual amount paid for transactions.

The sources said that the tax authorities had been empowered to take action where fair market value was not declared in purchase of immovable properties.

The real estate business is believed to parking lot for black money in Pakistan. Over the last few years the FBR made significant progress to encourage clean transactions in buying and selling of immovable properties.

February 2, 2020
Income tax return filing increases by 42%

ISLAMABAD: The filing of income tax returns has registered over 42 percent growth for tax year 2019 as compared with tax year 2018.

Federal Board of Revenue (FBR) on Saturday said that the number of annual returns filed for tax year 2019 2.342 million by January 31, 2020 as compared with 1.645 million returns for tax year 2018 filed till January 31, 2019.

The FBR attributed the increase in the return filing to improved confidence of people on the tax authorities.

However, the FBR extended the last date for filing income tax return for tax year 2019 up to February 28, 2020.

The FBR said that the tax collection for January 2020 was Rs320 billion which was 17 percent higher than in the revenue collected in the same month of the last year, showing 17 percent growth. Similarly, the total collection also registered 17 percent growth.

The FBR said that the tax revenue on domestic sources posted 30 percent increase, which was never seen in the past.

The FBR also issued refunds amounting to Rs120 billion in the current fiscal year as compared with Rs65 billion in the last fiscal year.

February 2, 2020
Registered persons to pay Rs5,000 as penalty for each invoice for not obtaining CNIC

KARACHI: Federal Board of Revenue (FBR) has said that registered persons to pay Rs5,000 as penalty amount on each invoice for failure to obtain CNIC information of buyers.

Sources in the FBR said that as per updated Sales Tax Act, 1990 up to December 31, 2019 any person who fails to issue an invoice when required under this Act, then such person shall pay a penalty of five thousand rupees or three percent of the amount of the tax involved, whichever is higher.

The penal amount has been specified for Section 23 of the Sales Tax Act, 1990, which mainly deals with tax invoices issued by registered persons, who are also liable to obtain information of Computerized National Identity Card (CNIC) of buyers on sales above Rs50,000.

The mandatory condition of obtaining CNIC information of unregistered persons has been applicable from February 01, 2020, which was to be applied from August 01, 2019.

As per the updated Sales Tax Act, 1990, the section said:

23. Tax Invoices.– (1) A registered person making a taxable supply shall issue a serially numbered tax invoice at the time of supply of goods containing the following particulars, in Urdu or English language, namely:

(a) name, address and registration number of the supplier;

(b) name, address and registration, number of the recipient and NIC or NTN of the unregistered person, as the case may be, excluding supplies made by a retailer where the transaction value inclusive of sales tax amount does not exceed rupees fifty thousand, if sale is being made to an ordinary consumer.

Explanation. – For the purpose of this clause, ordinary consumer means a person who is buying the goods for his own consumption and not for the purpose of re-sale or processing:

Provided that the condition of NIC or NTN shall be effective from 1st August, 2019;

(c) date of issue of invoice;

(d) description including count, denier and construction in case of textile yarn and fabric, and quantity of goods;

(e) value exclusive of tax;

(f) amount of sales tax; and

(g) value inclusive of tax:

Provided that the Board may, by notification in the official Gazette, specify such modified invoices for different persons or classes of persons; Provided further that not more than one tax invoice shall be issued for a taxable supply.

February 1, 2020
FBR chairman Shabbar Zaidi on indefinite leave

ISLAMABAD: Syed Muhammad Shabbar Zaidi, Chairman, Federal Board of Revenue (FBR) has gone on leave for indefinite period.
(more…)

February 1, 2020
FBR reshuffles senior customs officers in BS-20-22

ISLAMABAD: Federal Board of Revenue (FBR) on Friday reshuffled senior officers of Pakistan Customs Service (PCS) and notified transfers and postings with immediate effect and until further orders.

Notification of following officers has been issued:

01. Javed Ghani (PCS/BS-22), who is currently Member (Customs Policy), FBR (HQ), Islamabad, has been assigned additional charge of Member Customs (Operations), FBR (HQ), Islamabad.

02. Jawwad Uwais Agha (PCS/BS-21) has been transferred and posted as Member FBR (HQ) Islamabad from the post of Member (Customs Operations),FBR (HQ) Islamabad.

03. Muhammad Saleem (PCS/BS-20) has been transferred and posted as Collector, MCC (Appraisement), Peshawar from the post of Collector, MCC (Preventive), Multan.

04. Khaleel Ibrahim Yuousfani (PCS/BS-20) has been transferred and posted as Collector MCC (Preventive), Peshawar from the post of Collector, Collectorate of Customs (Appeals), Karachi.

05. Muhammad Yaqoob Mako (PCS/BS-20) has been transferred and posted as Collector, MCC (Preventive) Quetta from the post of Collector, MCC, Gawadar. He will also look after the charge of the Collector MCC, Gawadar.

06.Irfan-ur-Rehman (PCS/BS-20) has been transferred and posted as Collector, MCC (Appraisement), Quetta from the post of Director, Directorate of Transit, Trade, Quetta. He will also look after the charge of Directorate of Transit Trade, Quetta

07. Fayyaz Anwar (PCS/BS-20) has been transferred and posted as Collector MCC (Preventive), Multan from the post of Director, Directorate of I&I Gawadar.

08. Imtiaz Ahmed Sheikh (PCS/BS-20), who is current posted as Collector, MCC (Export) Karachi. He will also look after the charge of MCC (Export) PMBQ, Karachi.

09. Irfan Javed (PCS/BS-20), who is currently posted as Director, Directorate of I&I Karachi. He will also look after the charge of the post of Director, Directorate of I&I Gawadar.

10. Asif Saeed Khan Lughmani (PCS/BS-20) has been transferred and posted as Chief, FBR (HQ), Islamabad from the post of Collector MCC (Preventive) Peshawar.

11. Ihsan Ali Shah (PCS/BS-20) has been transferred and posted as Chief, FBR (HQ), Islamabad from the post of Collector, MCC (Appraisement), Peshawar.

12. Mr. Iftikhar Ahmed (PCS/BS-20) has been transferred and posted as Chief, FBR (HQ), Islamabad from the post of Collector, MCC (Preventive), Quetta.

13. Raza (PCS/BS-20) has been transferred and posted as Chief, FBR (HQ), Islamabad from the post of Collector, MCC (Appraisement), Quetta.

The FBR said that the officers who are drawing performance allowance prior to issuance of this notification shall continue to draw this allowance on the new place of posting.

January 31, 2020
FBR extends return filing date up to February 28

ISLAMABAD: Federal Board of Revenue (FBR) on Friday granted sixth consecutive extension for filing income tax return for tax year 2019 up to February 28, 2020.

The FBR issued Income Tax Circular No. 18 of 2019 for extension in date of filing income tax returns/statements for tax year 2019.

The FBR said that the date of filing of return of total income / statements of final taxation for individuals and associations of persons for the tax year 2019 which was due on September 30, 2019 and extended up to December 31, 2019 has been extended up to February 28, 2020.

The FBR further said that the date of filing of return of total income/statements of final taxation for companies for the tax year 2019, which was due on September 30, 2019 and extended up to December 31, 2019, in respect of those companies who have paid 90 percent of the admitted tax liability on or before September 30, 2019, has been allowed further extension up to February 28, 2020.

The date of filing of return of total income/statements of final taxation for companies for tax year 2019, which was due on December 31, 2019 has also been extended up to February 28, 2020.

January 31, 2020
Senior tax officers oppose return filing date extension

KARACHI: Senior officers of Federal Board of Revenue (FBR) opposed to further extend the last date for filing income tax return for tax year 2019.

The last date for filing annual return for tax year 2019 is expiring today evening i.e. January 31, 2020. The FBR already granted date extension around five times so far for filing the annual return.

The senior FBR officers at various tax offices have said that there was no need to further extend the date for filing the income tax returns because sufficient returns had been received by the FBR.

They further said that the deadline has been given to ensure compliance by taxpayers. They said that returns will be filed in case further time is granted.

The officers said that time and again extension in return filing date hurt the flow of working at the FBR.

They said that the FBR should invoke penal action on late return filers in order to ensure future compliance.

For the tax year 2018 the FBR extended the date for filing income tax returns up to August 09, 2019. Even to date the FBR is receiving income tax returns for the tax year 2018.

To an estimate the FBR received around 2.6 million returns for tax year 2019 till January 29, 2020. The FBR is expecting to receive 2.7 million returns by January 31, 2020, according to FBR sources.

The sources said that the FBR had estimated around 3 million returns for tax year 2019. The FBR will issue Active Taxpayers List (ATL) for tax year 2019 on March 01, 2020 and this list will remain applicable till February 28, 2021. Therefore, the return filing for the tax year 2019 will continue till the issuance of ATL for tax year 2020.

The ATL for tax year 2018 will expire on February 29, 2020. The FBR has received around 2.76 million returns for tax year 2018 as filing of returns for this year is continued so far.

January 31, 2020
CNIC condition on purchases above Rs50,000 applies from tomorrow

ISLAMABAD: The condition of Computerized National Identity Card (CNIC) on purchases above Rs50,000 shall apply from tomorrow (February 01, 2020) as relaxation provided to small traders is expiring today.

The Federal Board of Revenue (FBR) and representatives of traders’ associations on October 30, 2019 reached on an agreement under which the application of CNIC information was deferred till January 31, 2020.

Through Finance Act, 2019, it was made mandatory that a registered person making a taxable supply shall issue a serially numbered tax invoice at the time of supply of goods containing the following particulars, in Urdu or English language, namely: –

(a) name, address and registration number of the supplier;

(b) name, address and registration, number of the recipient and NIC or NTN of the unregistered person, as the case may be, excluding supplies made by a retailer where the transaction value inclusive of sales tax amount does not exceed rupees fifty thousand, if sale is being made to an ordinary consumer.

Explanation. – For the purpose of this clause, ordinary consumer means a person who is buying the goods for his own consumption and not for the purpose of re-sale or processing.

The condition of CNIC or NTN was made mandatory from August 01, 2019.

However, on opposition from small traders the government after an agreement on October 30, 2019, postponed the applicability of CNIC till January 31, 2020.

The FBR on October 04, 2019 issued definition / rules related to condition of CNIC.

The FBR said that keeping in view the problems reported by the registered persons is ensuring proper identity of the buyer to fulfil the requirement of reporting NTN/NIC of the buyer in terms of section 23 of the Sales Tax Act, 1990, it is directed that the NIC/NTN of the buyer with respect to taxable supplies to an unregistered person shall be deemed to have been reported in good faith by the supplier provided that:

(a) The tax invoice complies with the requirements of section 23(b) of the Act.

(b) Payment made by or on behalf of the unregistered purchaser of the amount of the tax invoice, inclusive of sales tax and applicable further tax, is deposited into the supplier’s declared business bank account.

(c) The NIC provided by the purchaser is found authenticated by the National Data and Registration Authority (NADRA).

(d) The NIC/NTN provided is not of the employee of the seller or of his associates as defined under the Income Tax Ordinance, 2001.

The issuance of a show cause notice to a registered person being a seller on account of any matter arising out of the NIC provided by a purchaser shall not be made without the prior approval of the Member (IR-Operations), FBR after providing an opportunity to be heard.

January 31, 2020
FBR links 5,783 POS of retailers with online system

ISLAMABAD: Federal Board of Revenue (FBR) has integrated 5,783 Point of Sales (POS) of 286 retailers so far with the hectic efforts of field formation, FBR spokesman said on Thursday.

The spokesman said that the system had been made fully functional. The entries made through POS have been directly received by the FBR through online system.

In order to create linkage with the FBR online system, retailers are required to download a software which is available on the FBR’s official website.

Once the software is downloaded and activated the transactions made by a retailer appeared on FBR system and stored in its database, the spokesman added.

All tier-1 retailers are required to integrate all their POSs with FBR’s computerized system.

‘Tier-1 retailer’ is defined in section 2(43A) of the Sales Tax Act, 1990, to be a person who falls in any of the following categories:

(a) a retailer operating as a unit of a national or international chain of stores;

(b) a retailer operating in an air-conditioned shopping mall, plaza or centre, excluding kiosks;

(c) a retailer whose cumulative electricity bill during the immediately preceding twelve consecutive months exceeds Rupees twelve hundred thousand;

(d) a wholesaler-cum-retailer, engaged in bulk import and supply of consumer goods on wholesale basis to the retailers as well as on retail basis to the general body of the consumers”; and

(e) a retailer, whose shop measures one thousand square feet in area or more.

POS integration is mandatory for all tier-1 retailers irrespective of the items they are dealing in.

All tier-1 retailers whether dealing in textile and leather items or any other item are required by law to integrate their POSs with FBR’s system.

The rate of sales tax for items sold by integrated retailers shall be the same as for all other suppliers as provided under the Sales Tax Act, 1990.

Only exception is for locally manufactured textile and leather items, which if sold by integrated retailers are subject to concessionary rate of 14 percent, and if sold by any other supplier are subject to 17 percent standard sales tax.

January 30, 2020
FBR invites suggestions for phasing out tax exemption, concessions

ISLAMABAD: Federal Board of Revenue (FBR) has invited suggestions from business community and other stakeholders for elimination of tax exemption and concessions.

The FBR on Thursday issued a notification for inviting income tax proposals for budget 2020/2021.

The FBR invited proposals from the stakeholders for phasing out tax concessions and exemptions.

It said that the FBR is currently engaged in the formulation of proposals for the Finance Bill 2020. In order to benefit from the collective wisdom of all the stakeholders for the improvement of tax policy, proposals have been invited for the upcoming budget 2020/2021.

The FBR said that input/suggestions in the following areas shall be appreciated as a genuine contribution towards framing or a broad based and workable tax policy:

i. Broadening of tax base for a wider participation in revenue generation efforts;

ii. Taxation of real income on progressive basis;

iii. Phasing out of tax concessions and exemptions;

iv. Removal of tax distortions and anomalies;

v. Facilitation of taxpayers and ease of doing business;

vi. Promoting equity in taxation by introducing measures where incidence of tax is higher or affluent classes.

The FBR asked all the stakeholders to send their proposals by February 07, 2020.

January 30, 2020