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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.

  • NPOs require to declare donation details above Rs5,000 to avoid cancellation of approval

    NPOs require to declare donation details above Rs5,000 to avoid cancellation of approval

    ISLAMABAD: Non-profit organizations are required to provide details of all donations above Rs5,000 in order to avoid cancellation of approval granted by Federal Board of Revenue (FBR), sources said on Wednesday.

    The sources said that under tax laws, an institutions, fund, trust, society or any other non-profit organization established in Pakistan for religious, educational, charitable, welfare or development proposes or for the promotion of an amateur sport shall require approval of the Commissioner of Inland Revenue (CIR) FBR.

    Under the law the commissioner has also been authorized to withdraw the approval to NPOs on the basis that the income tax returns were not filed or supported documents have not been provided along with the income tax returns.

    The sources said the NPOs are require to declare details of names and addresses of the persons from whom donations, contributions, subscriptions etc. exceeding Rs5,000 have been received during the tax year.

    Further, it is also mandatory that statement should contain the names and addresses of donees and beneficiaries etc. to whom payments, services etc. exceeding Rs5,000 have been made during the tax year.

    The sources said that the NPOs should provide statement of audited balance sheet and statement of accounts.

    Besides, the NPOs are required to provide a detailed performance evaluation report after every three years. “Provided that where such detailed performance evaluation report is not submitted on or before September 30 following every three tax years, the commissioner shall issue a show cause notice for withdrawal of approval to the concerned organization.”

    The NPOs are required to keep details of deduction of withholding tax and provide to the FBR as required under Section 165 of the Income Tax Ordinance, 2001.

    Further, the names, CNIC/NTN, last income declared, tax year and addresses of the promoters, directors, trustees, president, secretary, treasurer, manager and other office bearers, as the case may be, of the organization and indicating clearly their family relationship with each other.

  • Former tax official Irfan Nadeem dies of COVID

    Former tax official Irfan Nadeem dies of COVID

    KARACHI: Irfan Nadeem Syed, a former senior officer of Federal Board of Revenue (FBR), Tuesday died of COVID.

    He was on ventilator for the last two days to fight against the deadly coronavirus, sources said.

    Irfan Nadeem Sayed was senior officer BS-21 of Secretariat Group. However, he served as tax official. He was Member Direct Taxes before joining as additional director general of the Federal Investigation Agency in June 2009.

    Tax officials have paid homage to the departed soul.

    His namaz e Janaza will be at 10 am on January 27, 2021 at Masjid Bait-us-Salam Phase 4 DHA KARACHI

    His Residential address as shared by Madam Zareen is 18/2, M street, Phase IV, DHA KARACHI.

  • Rules notified for goods supplied from tax exempt areas

    Rules notified for goods supplied from tax exempt areas

    ISLAMABAD: Federal Board of Revenue (FBR) on Tuesday issued rules for tax treatment of goods supplied from tax exempt areas. In this regard the FBR issued SRO 96(I)/2021 to make amendment in Sale Tax Rules, 2006.

    The Sales Tax Act, 1990 defines “tax-exempt areas” as Azad Jammu and Kashmir, Gilgit-Baltistan, Tribal Areas as defined in Article 246 of the Constitution of the Islamic Republic of Pakistan.

    According to the rules , the person bringing, or causing to bring, taxable goods from tax exempt area shall be required to be registered under the Act or, as the case may be, the Sales Tax Act, 1990 as adopted in Azad Jammu and Kashmir and all the provisions of the Acts ibid shall apply accordingly.

    The liability of payment of tax or taxes and furnishing of prescribed documents shall be on the person bringing, or causing to bring, taxable goods from tax exempt area and supplying the same in taxable area in the course and furtherance of taxable activity.

    Subject to the applicable provisions of the Act and the rules made thereunder, a registered person shall be entitled to the adjustment of any input tax paid under the Sales Tax Act, 1990 as adopted in Azad Jammu and Kashmir.

    E-transport advice.— Every registered person bringing, or causing to bring, taxable goods from tax-exempt areas into taxable area, in the course and furtherance of taxable activity, shall login to FBR computerized system and electronically generate e-transport advice, with a unique identification number, in the form specified in STR 32. The e-transport advice shall be issued prior to entry of the taxable goods in to the taxable area.

    Provided that a registered person shall only be allowed to generate e-transport advice if he is not blacklisted or suspended in terms of section 21 of the Act and he has filed return under section 26 thereof by the due date for the last two immediately preceding tax periods.

    Where an e-transport advice has been generated under this rule, but goods are either not transported or are not transported as per the details furnished, the e-transport advice may be canceled within twelve hours of its issuance:

    Provided that the e-transport advice shall not be canceled after it has been examined by an authorized officer on any of the check-posts including the designated mobile teams.

    E-transport advice shall be valid for a period of up to one day for distances of up to 100 km in the taxable areas and one additional day for every 100 km or part thereof thereafter.

    Where due to unavoidable circumstances, the taxable goods cannot be transported within the validity period of the e-transport advice, the concerned Commissioner Inland Revenue, upon receiving application from the registered person, may extend the validity period.

    The details of e-transport advice shall be made available to the recipient of the supply who shall convey his acceptance or rejection of the supply of goods through the FBR computerized system:

    Provided that where no acceptance or rejection has been communicated by the recipient within forty-eight hours of such intimation or before the delivery of the goods, whichever is earlier, it shall be deemed that he has accepted the supply of the goods:

    Provided further that the provisions of this sub-rule shall not apply where the taxable goods are brought in to the taxable area by manufacturer or importer to be sold at self-own, self-managed, self-administrated or self-operated distribution, wholesale or retail outlet.

    The registered person may update the particulars of vehicle while the goods are in transit after duly intimating the concerned Commissioner Inland Revenue and providing reasons for the updating.

    Only one e-transport advice may be generated against a single invoice or, as the case may be, a stock advice and one conveyance may carry multiple e-transport advices in case it is transporting taxable goods relating to multiple invoices or stock advices:

    Provided where e-transport advice has been canceled under sub-rule (2), fresh e-transport advice may be generated against the same invoice or, as the case may be, stock advice.

    Prescribed documents.— Every conveyance carrying taxable goods originating from tax-exempt areas and entering taxable area shall carry the following documents at the time of entering into taxable areas namely: –

    sales tax invoice, in original, as prescribed under section 23 of the Act or as the case may be, under the Sales Tax Act, 1990 as adopted in Azad Jammu and Kashmir: Provided that where any taxable goods are exempt under the Sales Tax Act, 1990 as adopted in Azad Jammu and Kashmir or any notification issued thereunder, such goods shall be accompanied by a serially number invoice containing all particulars as specified in section 23 of the Act excluding the amount of sales tax and mentioning the legal provision under which exemption is claimed.:

    Provided further that where the taxable goods are brought in to the taxable area by a manufacturer or importer to be sold at his self-owned, self-managed, self-administered or self-operated distribution, wholesale or retail outlet or outlets, duly declared in his STR-1 Form, such goods shall be accompanied by serially numbered stock advice in the form specified in STR-33 along with copy of STR-1 Form.

    Goods declaration in case of imported goods; and e-transport advice as specified under rule 69D.

    The prescribed documents shall accompany the conveyance up to the destination mentioned in the relevant e-transport advice.

    Check-posts.— The Board may specify the location and other necessary particulars of check-posts, including mobile teams, if any, through a notification in the Official Gazette.

    The Chief Commissioners Inland Revenue of RTO Peshawar, RTO Abbottabad, RTO Rawalpindi, RTO Sialkot and RTO Quetta or any other RTO having jurisdiction over areas adjoining tax exempt areas, shall establish check-post or check-posts, as notified by the Board under sub-rule (1), within the relevant regional territorial jurisdiction.

    At the check-posts every conveyance entering into taxable area from tax exempt areas and carrying any taxable goods (including such goods as are prima facie deemed or suspected to be taxable) shall be subjected to scrutiny by the authorized officer.

    On the basis of credible information, mobile teams may proceed to intercept, examine and search any conveyance on the routes emanating from tax exempt areas and all the relevant provisions of the Act and these rules shall apply accordingly. A summary report of examination of taxable goods under sub-rule (3) or as the case may be under sub-rule (4), shall be recorded online by authorized officer mentioning the unique identification number of the e-transport advice in respect of the goods examined.

    Powers of the authorized officer. — Any taxable goods in respect of which any of the provisions of Act or these rules have been contravened shall be liable to be seized along with the conveyance, if any, in which such goods are laden or have been laden or which has been used for movement, carriage or transportation of such goods. 69H. Confiscation.— (1) The adjudicating authority, by passing an order in writing, shall have powers and authority to confiscate taxable goods which are brought in to taxable areas in violation of the Act and these rules.

    When any goods are confiscated under these rules, such goods shall thereupon vest in the Federal Government.

    The adjudicating authority after confiscation shall take and hold possession of the goods confiscated, and every officer of Inland Revenue, if required, shall assist him in taking and holding such possession.

    Goods in respect of which order under sub-rule (1) has been passed, and in respect of which the option of paying a fine in lieu of confiscation has not been exercised, shall be disposed of in such manner as the Chief Commissioner Inland Revenue, having jurisdiction may direct.

  • FBR exempts withholding tax on wheat import

    FBR exempts withholding tax on wheat import

    In a move to facilitate the import of essential commodities, the Federal Board of Revenue (FBR) issued a notification on Tuesday, exempting withholding income tax on the import of 300,000 metric tons of wheat.

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  • Law prohibits arrest of women, minors for tax recovery

    Law prohibits arrest of women, minors for tax recovery

    ISLAMABAD: Income tax law has prohibited tax officials from arresting any woman or a minor for recovery of tax default amount, officials at Federal Board of Revenue (FBR) said on Monday.

    They said that Commissioner Inland Revenue, having authority to recover tax amount by using various options defined under the law, has been prohibited to order the arrest of a woman or any person who, in his opinion, is a minor or of unsound mind.

    The officials said that Income Tax Rules, 2002 has explained in detailed about the powers of Commissioner of Inland Revenue related to recovery of outstanding tax money.

    The commissioner has an authority to ask officer incharge of the civil person for detention of the defaulter in civil prison under Rule 186(1) of the Income Tax Rules, 2002.

    Rule 187 explains detention in and release from prison.-

    (1) Every person detained in the civil prison in execution of a notice may be so detained-

    (a) where the notice is for a demand of an amount exceeding twenty five thousands, for a period of six months, and

    (b) in any other case for a period of six weeks:

    Provided that he shall be released from such detention-

    (i) on the amount mentioned in the warrant for his detention being paid to the Officer-in-charge of the civil prison, or

    (ii) on the request of the Commissioner who has issued the notice or of the Commissioner on any ground other than the grounds mentioned in rules 193(1) and 196:

    Provided further that where he is to be released on the request of the Commissioner, he shall not be released without the order of the Commissioner.

    (2) A defaulter released from detention under this rule shall not, merely by reason of his release, be discharged from his liability for the arrears; but he shall liable to be re-arrested under the notice in execution of which he was detained in the civil prison.

    Rule 188. Release.-

    (1) The Commissioner may order the release of a defaulter who has been arrested in execution of a notice upon being satisfied that he has disclosed the whole of his property and has placed it at the disposal of Commissioner and that he has not committed any act in bad faith.

    (2) If the Commissioner has ground for believing the disclosure made by the defaulter under sub-rule (1) to have been untrue, he may order the re-arrest of the defaulter in execution of the notice but the period of his detention in the prison shall not in the aggregate exceed that authorized by rule 187.

    Rule 189. Release on ground of illness.-

    (1) At any time after a warrant for the arrest of a defaulter has been issued, the Commissioner may cancel it on ground of the serious illness of the defaulter.

    (2) Where a defaulter has been arrested, the Commissioner may release him if, in the opinion of the Commissioner of Tax, he is not in a fit state of mind to be detained in the civil prison.

    (3) Where a defaulter has been committed to the civil prison, he may be, released therefrom by the Commissioner on the ground of the existence of any infectious or contagious disease or on the ground of his suffering from any illness.

    (4) A defaulter released under this rule may be re-arrested, but the period of his detention in the civil prison shall not in the aggregate exceed that authorized by rule 164.

  • FBR receives 3.06 million record high income tax returns for Tax Year 2019

    FBR receives 3.06 million record high income tax returns for Tax Year 2019

    ISLAMABAD: The Federal Board of Revenue (FBR) has achieved a record-breaking milestone by receiving 3.06 million income tax returns for the tax year 2019, as per the latest Active Taxpayers List (ATL) issued on Monday. This remarkable achievement reflects the FBR’s sustained efforts to enhance compliance and encourage taxpayers to fulfill their obligations.

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  • Sales tax value addition at 3 percent applicable on all imported goods

    Sales tax value addition at 3 percent applicable on all imported goods

    ISLAMABAD: Sales tax on account of minimum value addition at three percent is applicable on all imported goods subject to exclusions on import of various imported goods.

    According to Sales Tax Act, 1990, all imported goods are subject to 3 percent ad valorem subject to exclusion as in conditions and procedure.

    The government recently abolished three percent sales tax value addition on import of sugar to help in reducing domestic prices of the commodity.

    The officials at the Federal Board of Revenue (FBR) said that under the Sales Tax Act, 1990 the procedure and conditions have been laid down for the levy of three percent value addition tax on imported goods.

    (1) The sales tax on account of minimum value addition as payable under this Schedule (hereinafter referred to as value addition tax), shall be levied and collected at import stage from the importers on all taxable goods as are chargeable to tax under section 3 of the Act or any notification issued thereunder at the rate specified in the Table in addition to the tax chargeable under section 3 of the Act or a notification issued thereunder:

    (2) The value addition tax under this Schedule shall not be charged on,—

    (i) Raw materials and intermediary goods imported by a manufacturer for in-house consumption;

    (ii) The petroleum products falling in Chapter 27 of Pakistan Customs Tariff as imported by a licensed Oil Marketing Company for sale in the country;

    (iii) Registered service providers importing goods for their in-house business use for furtherance of their taxable activity and not intended for further supply;

    (iv) Cellular mobile phones or satellite phones;

    (v) LNG / RLNG;

    (vi) Second hand and worn clothing or footwear (PCT Heading 6309.000);

    (vii) Gold, in un-worked condition;

    (viii) Silver, in un-worked condition;

    (ix) The goods as specified in the Third Schedule on which tax is paid on retail price basis; and

    (x) plant, machinery and equipment falling in Chapters 84 and 85 of the First Schedule to the Customs Act, 1969 (IV of 1969), as are imported by a manufacturer for in-house installation or use.

    (3) The value addition tax paid at import stage shall form part of input tax, and the importer shall deduct the same from the output tax due for the tax period, subject to limitations and restrictions under the Act, for determining his net liability.

    The excess of input tax over output tax shall be carried forwarded to the next tax period as provided in section 10 of the Act.

    (4) The refund of excess input tax over output tax, which is attributable to tax paid under this Schedule, shall not be refunded to a registered person in any case, except that as used for making of zero-rated supplies.

    (5) The registered person, if also dealing in goods other than imported goods, shall be entitled to file refund claim of excess carried forward input tax for a period as provided in section 10 or in a notification issued there under by the Board after deducting the amount attributable to the tax paid at import stage i.e. sum of amounts paid during the claim period and brought forward to claim period. Such deducted amount may be carried forward to subsequent tax period.

  • Procedure for registration of FBR informer

    Procedure for registration of FBR informer

    ISLAMABAD: A person can share information of tax evasion and get monetary reward for the disclosure from Federal Board of Revenue (FBR) provided that the informer should be registered with a tax authority for the purpose.

    According to Income Tax Rules, 2002 a procedure has be laid down for registration of an informer.

    According to the rules, any person desirous of getting himself registered as an informer may make an application to the Chief Commissioner for registration.

    The application shall be in the prescribed form and shall be verified in the prescribed manner.

    The application shall be accompanied by the following documents, namely:

    (a) copy of the Computerized National Identity Card of the applicant;

    (b) copy of national tax number (NTN) certificate; and

    (c) a duly sworn in affidavit stating therein that the information being provided is correct and nothing has been concealed there from and that in case any incorrect information is provided or any information is concealed he shall be liable to penal action under the laws for the time being in force.

    The rules also explain the procedure for submission of information and further action thereupon.

    An informer shall submit any information regarding concealment or evasion of tax leading to detection or collection of taxes, fraud, corruption or misconduct that is in his possession to the Chief Commissioner giving precise details of the alleged act along with all supporting evidences that are in his possession:

    Provided that no information shall be entertained unless it gives precise details of the alleged act and is accompanied with the supporting evidences.

    On receipt of the information, the Chief Commissioner shall scrutinize the information and forward it to the concerned Commissioner.

    On receipt of the information from the Chief Commissioner, the concerned Commissioner shall conduct such further enquiry as he may deem fit and submit his report to the Chief Commissioner.

    On completion of the enquiry, the concerned Commissioner shall take such further action as may be required under the tax laws or any other law for the time being in force, as may be necessary on the basis of the facts of the case, and furnish his report to the Chief Commissioner.

    Notwithstanding anything contained in these rules, an informer, who −

    (a) has knowingly provided false information under these rules; or

    (b) has provided the information under these rules with the intention to intimidate or blackmail a person, or to bring him into disrepute, or to otherwise cause him financial loss, shall be liable to punishment and fine under the tax laws and other laws for the time being in force.

  • FBR issues rules for rewarding informers, officials on recovery of tax evaded money

    FBR issues rules for rewarding informers, officials on recovery of tax evaded money

    ISLAMABAD: Federal Board of Revenue (FBR) on Friday issued rules to reward tax officials and informers on detection and recovery of evaded amount.

    The FBR issued SRO 78(I)/2021 and said that officers and staff deputed to exercise powers, enforce and/or perform functions and duties in designated entities under the specified statutes and informers or whistleblowers.

    According to the rules, the officers / members of staff in Inland Revenue detecting the tax evasion shall be eligible for lesser of 20 percent of the tax sought to be evaded or two years’ salary at the time of detection/filing of the detection report.

    Further, officer/member of staff completing the adjudication/assessment the reward shall be lesser of 20 percent of the tax sought to be evaded or two years’ salary as at the time of completion of adjudication / assessment.

    The FBR said that if no appeal/revision has been filed against the assessment, the whole of the admissible reward shall be paid immediately after expiry of limitation for filing of appeal/revision.

    In case an appeal has been filed against the assessment order the admissible reward claim would be processed as: 50 percent upon confirmation at first appeal forum; and 50 percent upon completion of appellate process on point of fact i.e. Appellate Tribunal Inland Revenue (ATIR).

    The reward shall be paid only if the tax sought to be evaded has been recovered at least to the extent of 50 percent of the tax sought to be evaded.

    In case detection and assessment have been made by the same officer, he shall be entitled to the reward of the lesser of 20 percent of the tax sought to be evaded or three years’ salary as at the time of detection / filing of the detection report.

    In case there are more than one claimants of reward on account of detection or assessment, the reward would be apportioned as per the recommendation of the chief commissioner or director general concerned.

    An informer / whistleblower in terms of clause (v) of rule 2 shall be entitled to a reward at the rate of 20 percent up to a maximum of Rs5 million of the tax sought to be evaded in a single case.

  • Ordinance notified to extend tax amnesty for construction sector

    Ordinance notified to extend tax amnesty for construction sector

    ISLAMABAD: Federal Board of Revenue (FBR) on Friday notified changes made through presidential ordinance to tax amnesty scheme available to developers and builders.

    The Presidential Ordinance has been promulgated on January 19, 2021, which is called as the Income Tax (Amendment) Ordinance, 2021 and it has been enforced from January 01, 2021.

    Through the ordinance amendments have been made to Income Tax Ordinance, 2001.

    According to this, amendment has been made to Section 100D of Income Tax Ordinance, 2001, the completion of project for availing amnesty on invested amount has been extended to September 30, 2023 from September 30, 2022.

    The date has also been extended for the amnesty on investment made in a housing project up to June 30, 2021 from the date of December 31, 2020.