Tag: Federal Board of Revenue

The Federal Board of Revenue is Pakistan’s apex tax agency, overseeing tax collection and policies. Pakistan Revenue is committed to providing timely updates on the Federal Board of Revenue to its readers.

Pre-arrival customs clearance rolled out to five airlines

ISLAMABAD: Federal Board of Revenue (FBR) on Tuesday said that it has extended the pre-arrival custom clearance facility to five airlines.

A FBR spokesman on a pilot project on customs clearance in the Sky that was started with Qatar Airways has now been rolled out to five other airlines.

Urgent shipments on Turkish Airlines, Fly Dubai, Air Arabia and YTO cargo are being processed through customs risk management system hours before flight arrival at Karachi Airport.

Pakistan Customs has introduced a pre-arrival clearance facility last month under its flagship pilot project ‘Clearance in the Sky’ at Model Customs Collectorate (MCC), Jinnah International Airport (JIAP) Karachi.

The cargo manifest is filed in advance immediately after the take-off of the flight from the origin. The advance feeding of manifest allows the traders and their customs clearing agents to file their goods declarations to the customs.

The declarations filed in advance are checked through the risk management system. An electronic message on the release status is sent to the traders while the goods are still in the air.

March 2, 2021
I&I IR to gather information of suspicious financial transactions

ISLAMABAD: The Directorate General of Intelligence and Investigation (I&I) of Inland Revenue has been empowered to gather information about suspicious financial transactions, including investment and expenses.

The Federal Board of Revenue (FBR) on Tuesday issued SRO 272(I)/2021 to authorized the directorate for making various activities to identify income tax evasion.

The functions of the Directorate-General of Intelligence and Investigation, Inland Revenue shall be:

— To carry out intelligence activities, access and verification of business premises, access to record/documents or system maintained therein, intelligence gathering on all tax related issues including under-reporting, tax evasion and revenue leakages.

— To collect information/record/documents from any person including taxpayer and third party-relating to financial transactions like investment and expenses etc. and details of persons who are involved in such activities.

— To process information and take necessary action on the basis of information provided by any other organization, agency or department under the relevant provisions of Income Tax Ordinance, 2001.

— To utilize the information obtained through establishment of linkages by the FBR with all major national, provincial other data bases to collect relevant information.

— To identify cases of income tax evasion and carry out inquiry, investigation, whichever is deemed fit, to retrieve the loss of revenue; to identify, investigate and prosecute cases of tax evasion and/or offences punishable under the Income Tax Ordinance, 2001 and the rules made thereunder.

— To share and disseminate actionable information and corroborating evidence, where required, through written reports or information reports or otherwise to authorities or officers in the headquarters and field formations of the FBR for further proceedings.

— To process, investigate and prosecute complaints of tax evasion.

— To process, investigate and prosecute information shared by other agencies.

— To carry out any other work or function that may be assigned to it by the FBR.

March 2, 2021
FBR devises mechanism for release of consignments stuck-up at Karachi ports

ISLAMABAD: Federal Board of Revenue (FBR) on Tuesday devised a mechanism for release of imported goods of FATA/PATA residents stuck-up at Karachi ports.

A meeting was held under the Chairmanship of the FBR chairman with Inland Revenue-Operations and Customs Operations Wings to sort out the issues of imported goods of FATA/PATA residents stuck-up at Karachi Ports, Consumption/Installation Certificates, Postdated Cheques and Exemption Certificates under Section 148 of the Income Tax Ordinance, 2021.

After thorough deliberations between the Chairman, Member (IR-Operations) and Member (Customs-Operations) following mechanism was devised for the release of consignments of FATA/PATA residents stuck-up at the Karachi Ports:-

The stuck-up containers are to be released by Customs authorities against Postdated Cheques (PDCs) and sent to their destination (FATA/PATA) under standard tracker mechanism.

The Collector Customs (Enforcement & Compliance), Peshawar, will issue detention orders of the raw materials effective from day the consignment reaches the manufacturing premise of importers.

The importer/manufacturer will be responsible to take the import documents alongwith detention order to the CIR concerned, RTO, Peshawar and make arrangements to have the manufacturing premises/raw material/machinery/goods imported verified.

The CIR concerned, RTO, Peshawar will be liable to verify/undertake physical visit as conducted by the importer/manufacturer to the manufacturing premises where the goods are kept under detention, and allow the raw material to be consumed/utilized in writing.

The CIR, concerned, RTO, Peshawar will ensure the monthly stock-taking of the raw materials to consumed in the production of manufactured goods by these manufacturing units. This stock-taking will facilitate in issuance of the

Consumption Certificate under S.No.151 of the Sixth Schedule of the Sales Tax Act, 1990.

The residents of FATA/PATA will apply for tax exemption certificates under section 159 of the Income Tax Ordinance, 2001 for the import of raw material/machinery in light of the Honorable Peshawar High Court, Mingora Bench, (Dara-ul-Qaza), Swat’s decision dated 24.11.2020.

Commissioner Corporate, RTO, Peshawar and Collector Customs (Enforcement & Compliance), Peshawar would keep a close liaison to successfully implement the laid down mechanism.

March 2, 2021
What is ‘start up’ under income tax ordinance?

Income Tax Ordinance, 2001 has defined the meaning of ‘start up’ for the purpose of levying income tax.

The Income Tax Ordinance, 2001 updated up to June 30, 2020 issued by the Federal Board of Revenue (FBR), defined ‘startup’ as:

(i) a business of a resident individual, AOP or a company that commenced on or after first day of July, 2012 and the person is engaged in or intends to offer technology driven products or services to any sector of the economy provided that the person is registered with and duly certified by the Pakistan Software Export Board (PSEB) and has turnover of less than one hundred million in each of the last five tax years; or

(ii) any business of a person or class of persons, subject to the conditions as the Federal Government may, by notification in the official Gazette, specify.

March 2, 2021
Small company defined by income tax ordinance

Income Tax Ordinance, 2001 has defined the meaning of ‘small company for the purpose of levying income tax.

The Income Tax Ordinance, 2001 updated up to June 30, 2020 issued by the Federal Board of Revenue (FBR), explained ‘small company as a company registered on or after the first day of July, 2005, under the Companies Ordinance, 1984 (XLVII) of 1984, which,—

(i) has paid up capital plus undistributed reserves not exceeding fifty million rupees;

(ia) has employees not exceeding two hundred and fifty any time during the year;

(ii) has annual turnover not exceeding two hundred and fifty million rupees; and

(iii) is not formed by the splitting up or the reconstitution of company already in existence.

March 2, 2021
Inland Revenue officer suspended

ISLAMABAD: Federal Board of Revenue (FBR) on Monday suspended a BS-18 officer of Inland Revenue Service (IRS) for four months with immediate effect.

A notification said that the FBR while exercising powers conferred under Rule 5 of the Civil Servants (Efficiency & Discipline) Rules, 2020, placed Muhammad Jamshed Khan (IRS/BS-18), presently posted as deputy commissioner, Regional Tax Office, Rawalpindi under suspension for a period of 120 days with immediate effect until further orders.

March 1, 2021
Member IR Operations receives complaints himself to eradicate corruption

ISLAMABAD: Member Inland Revenue (Operations) will directly receive complaints against corruption in order to provide secure channel of lodging complaints and in this regard SOP has been devised for handling of complaints.

The Circular No. 10 of 2021 – Operations issued on Monday, stated that in order to allay the fears of business community and citizen taxpayers, a convenient, and protected mechanism of filing complaints against corruption is being devised whereby all complaints would be received by Member IR Operation himself on an especially dedicated cell phone +92-0345-5555507; the cell phone would be in his own possession, exclusively.

“The complaints would be opened, acknowledged, and treated as per law in a highly confidential manner.”

The identity of the complainants would be immediately masked and encoded to safeguard them against any undue consequences.

The standard operating procedure (SOP) for lodging and handling of complaints against field functionaries is as under:

i. Complaints would be lodged through text message at cell No.. +92-345-5555507 – on Whatsapp, preferably.

ii. In Whatsapp text option, the complainant would identify himself by writing his name, address, CNIC the case particular and his cell phone number.

iii. The complainant would write the name(s) of the official(s) against whom the complaint is directed along with his/their designation, place of posting, and any other particulars, if available.

iv. The complaint must be supported by some evidence such as audio or video recording, text message exchange with the FBR functionary or any other documents, which could be attached with the text message, or subsequently sent by hard mail. If no such evidence is readily available, and affidavit on a legal paper, clearly spelling out the allegation and the person against whom the allegations are leveled would suffice.

v. Upon receipt of the complaint, a code number would be allotted to each complainant and his back-end identity data would be hidden beyond the access of field officers. This code number would help a complainant track progress on his complaint and the outcomes on it.

vi. Depending on the nature of the complaint and the evidence provided, the matter would be taken to logical consequence in the shortest possible time.

vii. Non-specific, unsupported or generalized complaints may not be processed.

The FBR said that taxpayers could not lodge complaints of corruption, rent-seeking and unethical conduct against any FBR functionary without any fear of reaction or revenge. However, in order to maintain the integrity of the system and achieve its intended objectives, the complainants would not level generalized allegations, and instead, file solid complaints, duly supported by evidence, and affidavits against the delinquent functionaries so that the malaise of corruption could be eliminated from the revenue functions of the state.

March 1, 2021
Eurobonds, Sukuks granted income tax exemption

ISLAMABAD: Federal Board of Revenue (FBR) on Monday granted income tax exemption on profits derived by foreign nationals on yield of Eurobonds and International Sukuk issued by the government of Pakistan.

In this regard the FBR issued two notifications to make changes in Income Tax Ordinance, 2001.

The FBR issued SRO 268(I)/2021 and SRO 269 (I)/2021.

The FBR granted the exemption while exercising powers available under the Second Schedule of the Ordinance. Under the Schedule the government has authority to grant tax exemption of the income derived by foreign nationals of companies.

According to the notifications, the government granted the exemption to the profit on debt income of an agency of a foreign government, a foreign national company, firm or association of a person or any other non-resident person, on Eurobonds and International Sukuks issued under the government’s medium term note program.

March 1, 2021
FBR issues 2.1 million notices for non-filing, misdeclaring assets

ISLAMABAD: The tax authorities have issued 2.1 million notices to individuals and companies for non-compliance in annual return filing and to those who misdeclared assets in their annual returns of income, a statement issued by Federal Board of Revenue (FBR) said on Sunday.

These notices were sent to defaulters by February 28, 2021. The FBR issued notices around 1.4 million by January 31, 2021. It means during the month of February 2021 the revenue body issued another 700,000 notices to defaulters.

FBR is taking such action to broaden the tax base in the country. Early signs suggest such efforts are bearing fruits. As on February 28, 2021, the number of income tax returns filed was 2.63 million for tax year 2020 as compared with 2.43 million last year, showing an increase of 8 percent.

The FBR said that the tax return with return, however, increased by 60 percent to Rs49.6 billion up to February 28, 2021 as compared with Rs31 billion by the same date of the last year.

The FBR said that the income tax return for tax year 2020 had been increased despite the last date was not extended beyond December 08, 2020. Meanwhile the last date for filing income tax returns for tax year 2019 was extended up to February 25, 2020.

The exercise is eliciting encouraging response. However, those who are not complying would be pursued diligently until compliance is achieved.

Watch the story at the PkRevenue YouTube channel:

March 1, 2021
FBR receives 2.63 million income tax returns for tax year 2020

ISLAMABAD: Federal Board of Revenue (FBR) has received 2.63 million income tax returns for tax year 2020 by February 28, 2021, just one day ahead of issuing new Active Taxpayers List (ATL).

According to a statement issued on Sunday the FBR said that it had received 2.63 million income tax returns for tax year 2020 by February 28, 2021, which is 8 percent higher when compared with 2.43 million returns for tax year 2019 on the same date a year ago.

The FBR said that the tax return with return, however, increased by 60 percent to Rs49.6 billion up to February 28, 2021 as compared with Rs31 billion by the same date of the last year.

The FBR said that the income tax return for tax year 2020 had been increased despite the last date was not extended beyond December 08, 2020. Meanwhile the last date for filing income tax returns for tax year 2019 was extended up to February 25, 2020.

The FBR is scheduled to announce Active Taxpayers List (ATL) for tax year 2020 on March 01, 2021 which will carry the name of those taxpayers who filed their returns by due date or extended by commissioner inland revenue.

However, those late return filer will get also their names on the list who paid surcharge.

February 28, 2021