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.

Countdown begins for tax year 2019 return filing

KARACHI: Federal Board of Revenue (FBR) has given less than a month to taxpayers for filing income tax return and wealth statements for tax year 2019.

The FBR on Monday issued finalized income tax return forms form salaried persons, business individuals and Association of Persons (AOPs).

The last date for filing income tax returns and wealth statement for such segments of taxpayers is September 30, 2019.

The last date for filing of income tax returns by salaried persons has been amended through Finance Act, 2019 to September 30, 2019 from August 31, 2019.

These taxpayers have a time of 28 days to comply with the statutory requirement under Section 118 of Income Tax Ordinance, 2001.

Corporate entities having accounting year ending any time between the first day of January and the thirtieth day of June are required to file income tax returns on or before the thirty-first day of December next following the end of the tax year to which the return relates.

In any other case, on or before the thirtieth day of September next following the end of the tax year to which the return relates.

However, the corporate returns are still in draft format and FBR likely to issue finalized return form for companies by this week.

According to Income Tax Ordinance, 2001 every resident taxpayer being an individual filing a return of income for any tax year shall furnish a wealth statement and wealth reconciliation statement for that year along with such return:

It also explained that every member of an association of persons is also required to furnish wealth statement and wealth reconciliation statement for the year along with return of income of the association.

For tax year 2019, every resident taxpayer being an individual having foreign income of not less than ten thousand United States dollars or having foreign assets with a value of not less than one hundred thousand United States dollars shall furnish a statement, hereinafter referred to as the foreign income and assets statement, in the prescribed form and verified in the prescribed manner giving particulars of—

(a) the person’s total foreign assets and liabilities as on the last day of the tax year;

(b) any foreign assets transferred by the person to any other person during the tax year and the consideration for the said transfer; and

(c) complete particulars of foreign income, the expenditure derived during the tax year and the expenditure wholly and necessarily for the purposes of deriving the said income.

Under Section 114 of Income Tax Ordinance, 2001 following persons are required to furnish a return of income for a tax year, namely:–

(a) every company;

(ab) every person (other than a company) whose taxable income for the year exceeds the maximum amount that is not chargeable to tax under this Ordinance for the year;

(ac) any non-profit organization as defined in clause (36) of section 2;

(ad) any welfare institution approved under clause (58) of Part I of the Second Schedule;

(b) any person not covered by clause (a), (ab), (ac) or (ad) who,—

(i) has been charged to tax in respect of any of the two preceding tax years;

(ii) claims a loss carried forward under this Ordinance for a tax year;

(iii) owns immovable property with a land area of two hundred and fifty square yards or more or owns any flat located in areas falling within the municipal limits existing immediately before the commencement of Local Government laws in the provinces; or areas in a Cantonment; or the Islamabad Capital Territory;

(iv) owns immoveable property with a land area of five hundred square yards or more located in a rating area;

(v) owns a flat having covered area of two thousand square feet or more located in a rating area;

(vi) owns a motor vehicle having engine capacity above 1000 CC;

(vii) has obtained National Tax Number; or

(viii) is the holder of commercial or industrial connection of electricity where the amount of annual bill exceeds rupees five hundred thousand;

(ix) is a resident person registered with any chamber of commerce and industry or any trade or business association or any market committee or any professional body including Pakistan Engineering Council, Pakistan Medical and Dental Council, Pakistan Bar Council or any Provincial Bar Council, Institute of Chartered Accountants of Pakistan or Institute of Cost and Management Accountants of Pakistan; or

(x) every resident person being an individual required to file foreign income and assets statement under section 116A.

(1A) Every individual whose income under the head ‘Income from business’ exceeds rupees three hundred thousand but does not exceed rupees four hundred thousand in a tax year is also required to furnish return of income from the tax year.

(2) A return of income –

(a) shall be in the prescribed form and shall be accompanied by such annexures, statements or documents as may be prescribed;

(b) shall fully state all the relevant particulars or information as specified in the form of return, including a declaration of the records kept by the taxpayer;

(c) shall be signed by the person, being an individual, or the person’s representative where section 172 applies;

(d) shall be accompanied with evidence of payment of due tax as per return of income;

(e) shall be accompanied with a wealth statement as required under section 116; and

(f) shall be accompanied with a foreign income and assets statement as required under section 116A.

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FBR issues final return forms tax year 2019 for salary persons, business individuals

September 3, 2019
FBR issues first batch of e-refund

ISLAMABAD: The first payment through Fully Automated Sales Tax e-Refund (FASTER) module, against the refund claims for the tax period July, 2019, has been made on Monday September 02, 2019, and the State Bank of Pakistan has confirmed the credit of the refund amount in the bank account of the claimant, said a press release issued by Federal Board of Revenue (FBR).

It is highlighted that only nine refund claims of five exporter-oriented sectors were received by Friday, the 30th August, 2019, and the payment has been made against the claim that was cleared by the risk management system of FASTER module.

It is added that the number of refund claims received is not significant. FBR encourages the exporters to submit their claims in form Annex-H at the earliest so that their claims can be processed and paid.

In consequence of rescission of SRO 1125(I)/2011 dated 31.12.2011, which allowed zero-rating of inputs of five export-oriented sectors, Federal Board of Revenue had committed with the exporters of the said sectors, i.e. textiles, leather, carpets, sports goods and surgical goods, that refunds shall be paid to them within 72 hours of filing of refund claim.

FBR has earlier clarified that submission of Annex-H, which is a form in the monthly sales tax return, shall be treated as submission of refund claim.

For this purpose, FBR has developed a new IT module known as FASTER (Fully Automated Sales Tax e-Refund) and the same has been operationalized.

This module shall process claims of exporters of five export-oriented sectors for the tax period July, 2019, and onwards.

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September 2, 2019
FBR issues final return forms tax year 2019 for salary persons, business individuals

The Federal Board of Revenue (FBR) has taken a significant step towards concluding the tax assessment process for the year 2019 by issuing the final return forms for salaried individuals, business entities, and Associations of Persons (AOPs).
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September 2, 2019
FBR explains treatment of duty, taxes on goods imported under foreign trade agreements

The Federal Board of Revenue (FBR) has provided comprehensive details regarding the taxes for goods imported under trade agreements with foreign countries.
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September 2, 2019
FBR explains dutiable goods imported into Pakistan

KARACHI: Federal Board of Revenue (FBR) has defined dutiable goods imported into Pakistan under Customs Act, 1969.

The FBR issued Customs Act, 1969 updated June 30, 2019 and explained goods dutiable under Section 118 of the Act.

Section 18: Goods dutiable

(1) Except as hereinafter provided, customs duties shall be levied at such rates as are prescribed in the First Schedule or under any other law for the time being in force on,-

(a) goods imported into Pakistan;

(b) goods brought from any foreign country to any customs station, and without payment of duty there, transshipped or transported for, or thence carried to, and imported at any other customs-station; and

(c) goods brought in bond from one customs station to another. 105(1A) Notwithstanding anything contained in sub-section (1), customs duties shall be levied at such rates on import of goods or class of goods as are prescribed in the Fifth Schedule, subject to such conditions, limitations and restrictions as prescribed therein.

(2) No export duty shall be levied on the goods exported from Pakistan.

(3) The Federal Government may, by notification in the official Gazette, levy, subject to such conditions, limitations or restrictions as it may deem fit to impose, a regulatory duty on all or any of the goods imported or exported, as specified in the First Schedule at a rate not exceeding one hundred per cent of the value of such goods as determined under section 25 or, as the case may be, section 25A.

(4) The regulatory duty levied under sub-section (3) shall –

(a) be in addition to any duty imposed under sub-section (1) or under any other law for the time being in force; and

(b) be leviable on and from the day specified in the notification issued under that sub-section, notwithstanding the fact that the issue of the official Gazette in which such notification appears is published at any time after that day.]

(5) The Federal Government may, by notification in the official Gazette, levy an additional customs-duty on such imported goods as are specified in the First Schedule, at a rate not exceeding thirty-five per cent of value of such goods as determined under section 25 or, as the case may be, section 25A:

Provided that the cumulative incidence of customs-duties leviable under sub-sections (1) and (5) shall not exceed the rates agreed to by the Government of Pakistan under multilateral trade agreements.

(6) The additional customs-duty levied under sub-section (5) shall be,-

(a) in addition to any duty imposed under sub-sections (1) and (3) or under any other law for the time being in force; and

(b) leviable on and from the day specified in the notification issued under that sub-section, notwithstanding the fact that the official Gazette in which such notification appears is published at any time after that day.

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September 1, 2019
All sales tax refund claims to be processed through risk management system

ISLAMABAD: Federal Board of Revenue (FBR) has said that every refund claim of sales tax refund shall be processed through Risk Management System of the FBR’s computerized system.

The FBR amended the Sales Tax Rules, 2006 through SRO 918(I)/2019 to make mandatory the routing of refund claims through RMS of the FBR’s computerized system.

Based on the parameters in RMS, a refund claim shall be routed to any of the following three channels as described below, namely:−

(a) Fully Automated Sales Tax e-Refund System (FASTER), The provisions related to this channel are prescribed in Chapter V-A.

(b) Expeditious Refund System (ERS), The claims filed by the manufacturer cum-exporters under section 10 of the Act that do not fulfill parameters of FASTER channel and the same are considered as involving medium risk by RMS shall be routed to ERS. The RPO for verified amount shall be generated and forwarded to CSTRO for payment.

(c) Sales Tax Automated Refund Repository (STARR), The claims that do not fulfill criteria for both FASTER and ERS channels shall be processed through STARR in the manner as provided in rule 29.

For the refund claims processed through FASTER or ERS, the part of the refund claim that is not verified or not found admissible shall be subjected to system validation checks every week and Refund Payment Order (RPO) shall be generated for the amount found valid during each validation check. After every validation process, the information regarding RPO generated, if any, as well as the objections shall be communicated by the system to the refund claimant and also to the concerned RTO or LTU for information.

The FBR said that RPO so generated shall be communicated to the State Bank of Pakistan for payment in the aforesaid manner. After eight validation checks, including the initial one, if any amount still remains un-cleared, the same shall then be processed under STARR channel.

August 31, 2019
Abolition of SRO 1125 does not affect income tax concessions

KARACHI: The abolition of SRO 1125(I)/2011 has not taken away concessions available under income tax laws, the ministry of law and justice said in its opinion.

The SRO 1125(I)/2011 has been rescinded through Finance Act, 2019 and all the benefits available under this such as zero-rating of sales tax and reduced rates of sales tax had been abolished.

The Federal Board of Revenue (FBR) sent an Office Memorandum (OM) to the ministry of law and justice explaining that SRO 1125(I)/2011 dated December 31, 2011 had prescribed zero-rate sales tax for a particular class of taxpayers, while SRO 480(I)/2007 dated June 09, 2007 had specified the Sales Tax Procedure Rules, 2007.

Both SROs stood rescinded through SRO 694(I)/2019 dated June 29, 2019.

“Thus, in view of the aforesaid recession there is no doubt that the sales tax concession available under SRO 1125 and SRO 480 is no longer available.”

The ministry said that the answer to the queries raised in the OM warrants to be divided into two parts. The first part deals with Part II of the First Schedule to the Income Tax Ordinance, 2001, which deals with imports under Section 148 of the 2001 Ordinance; while the second part deals with Section 235-B(1) of the 2001 Ordinance.

“We have been instructed to the effect that Part II of the First Schedule to the 2001 Ordinance has given a certain reprieve to a ‘specified class of taxpayers’ for the purposes of import under section 148 of the 2001 Ordinance. In prescribing the said reprieve of income tax, the specified class of taxpayers who qualify for the said concession have been described in Part II of the First Schedule to the 2001 Ordinance to be those who are covered under SRO 1125 i.e. the notification which had prescribed the zero rated sales tax.”

“Therefore, the precise query posed to us is whether the repeal of SRO 1125 automatically also takes away the income tax concession given under Part II of the First Schedule to the 2001 Ordinance, in respect of imports under Section 148 of the 2001 Ordinance, 2001? The simple answer is that the concession prescribed in Part II of the First Schedule to the 2001 Ordinance has not been taken away.”

It is only for the purpose of a handy and convenient description of the person who are meant to enjoy the benefit or reprieve under Part II of the First Schedule to the 2001 Ordinance have been cross referred or defined to be the ‘specified class of taxpayers’ who qualify for the reprieve under SRO 1125.

The said reference is only for the purpose of a convenient identification of that class which is meant to enjoy the concession under Part II of First Schedule to the Income Tax Ordinance, 2001, the ministry said.

August 31, 2019
FBR lists prohibited items for import, export

KARACHI: Federal Board of Revenue (FBR) has issued list of items that are prohibited for clearance of import or export under Customs Act, 1969.

The FBR issued Customs Act, 1969 updated till June 30, 2019 (incorporating changes brought through Finance Act, 2019) and explained Section 15 related to prohibition.

Section 15

Prohibitions:- No goods specified in the following clauses shall be brought into or taken out of Pakistan, namely:-

(a) counterfeit coins, forged or counterfeit currency notes, and any other counterfeit product;

(b) any obscene book, pamphlet, paper, drawing, painting, representation, figure, photograph, film, or, article, video or audio recording, CDs or recording on any other media;

(c) goods having applied thereto a counterfeit trade mark within the meaning of the Pakistan Penal Code, 1860 (Act XLV of 1860), or a false trade description within the meaning of the Copyright Ordinance, 1962 (XXXIV of 1962), the Registered Layout-Designs of Integrated Circuits Ordinance, 2000 (XLIX of 2000), the Registered Designs Ordinance, 2000 (XLV of 2000), the Patents Ordinance, 2000 (LXI of 2000), and the Trade Marks Ordinance, 2001 (XIX of 2001);

(d) goods made or produced outside Pakistan and having applied thereto any name or trade mark, being or purporting to be the name or trade mark of any manufacturer, dealer or trader in Pakistan, unless,-

(i) the name or trade mark is, as to every application thereof, accompanied by a definite indication of the goods having been made or produced in a place outside Pakistan; and

(ii) the country in which that place is situated is in that indication shown in letters as large and conspicuous as any letter in the name or trade mark, and in the same language and character as the name or trade mark;

(e) goods involving infringement of copyright, layout-design of integrated circuits, industrial designs, patents within the meaning of the Copyright Ordinance, 1962 (XXXIV of 1962), the Registered Designs Ordinance, 2000 (XLV of 2000), and the Patents Ordinance, 2000 (LXI of 2000), respectively; and

(f) goods made or produced outside Pakistan and intended for sale, and having applied thereto, a design in which copyright exists under the Copyright Ordinance, 1962 (XXXIV of 1962), the Registered Layout –Designs of Integrated Circuits Ordinance, 2000 (XLV of 2000), the Patents Ordinance, 2000 (LXI of 2000), and the Trade Marks Ordinance, 2001 (XIX of 2001), in respect of the class to which the goods belong or any fraudulent or obvious imitation of such design, patent, copyright except when the application of such design has been made with the license or written consent of the registered proprietor, right holder of the design, patent or copyright, as the case may be:

Provided that offences relating to goods imported or exported in violation of Intellectual Property Rights shall, notwithstanding any thing contained in any other law for the time being in force, be adjudicated under section 179 by the appropriate officer of customs.

Section 16

Power to prohibit or restrict importation and exportation of goods.- The Federal Government may, from time to time, by notification in the official Gazette, prohibit or restrict the bringing into or taking out of Pakistan of any goods of specified description by air, sea or land.

Section 17

Detention, seizure and confiscation of goods imported in violation of section 15 or section 16.- Where any goods are imported into, or attempted to be exported out of, Pakistan in violation of the provisions of section 15 or of a notification under section 16, such goods shall, without prejudice to any other penalty to which the offender may be liable under this Act or the rules made there under or any other law, be liable to detention, for seizure or confiscation subject to approval of an officer not below the rank of an Assistant Collector of Customs, and seizure for confiscation through adjudication, if required.

It may be mention here that the ministry of commerce through SROs 927 and 928 dated August 9, 2019 imposed complete ban on trade with India.

August 31, 2019
FBR transfers BS-20 officers of Pakistan Customs Service

ISLAMABAD: Federal Board of Revenue (FBR) has notified transfers and postings of officers of BS-20 Pakistan Customs Service (PCS) with immediate effect and until further orders.

The following customs officers have been transferred and posted:

01. Dr Samina Taslim Zehra (Pakistan Customs Service/BS-20) has been transferred and posted as Director, Directorate of Input Output Co-efficient Organization (South), Karachi from the post of Chief, Federal Board of Revenue (Hq), Islamabad.

02. Muhammad Asghar Khan (Pakistan Customs Service/BS-20) has been transferred and posted as Director, Directorate General of Intelligence & Investigation, FBR, from the post of Islamabad Additional Director, Directorate of Post Clearance Audit, Islamabad.

03. Ms. Rabab Sikandar (Pakistan Customs Service/BS-20) has been transferred and posted as Director, Directorate of Intellectual Property Rights (IPR) Enforcement (Central), Lahore from the post of Director, Directorate of Intelligence & Investigation, FBR, Lahore.

04. Mirza Mubashir Baig (Pakistan Customs Service/BS-20) has been transferred and posted as Director, Directorate General of IPR Enforcement (North), Islamabad from the post of Collector, Model Customs Collectorate, Faisalabad.

05. Ms. Saima Shehzad (Pakistan Customs Service/BS-20) has been transferred and posted as Collector, Model Customs Collectorate of Appraisement, Faisalabad from the post of Collector, Collectorate of Customs, (Appeals), Lahore.

06. Ms. Iram Maqbool Aamir (Pakistan Customs Service/BS-20) has been transferred and posted as Director, Directorate of Training & Research (Customs), Islamabad from the post of Director, Directorate General of Intelligence & Investigation, FBR, Islamabad.

07. Muhammad Saleem (Pakistan Customs Service/BS-20) has been transferred and posted as Collector, Model Customs Collectorate of Preventive, Multan from the post of Chief, Federal Board of Revenue (Hq), Islamabad.

08. Ms. Naureen Ahmad Tarar (Pakistan Customs Service/BS-20) has been transferred and posted as Collector, Collectorate of Customs, (Appeals), Lahore from the post of Director, Directorate of Customs Valuation, Lahore.

09. Ms. Ambreen Ahmad Tarar (Pakistan Customs Service/BS-20) has been transferred and posted as Director, Directorate of Customs Valuation, Lahore from the post of Collector, Model Customs Collectorate, Multan.

10. Basit Maqsood Abbasi (Pakistan Customs Service/BS-20) has been transferred and posted as Collector, Model Customs Collectorate (AIIA), Lahore from the post of Additional Collector, Model Customs Collectorate of Preventive, Lahore.

11. Ms. Sadia Munib (Pakistan Customs Service/BS-20) has been transferred and posted as Director, Directorate of Intelligence & Investigation, FBR, Lahore from the post of Additional Director, Directorate of Intelligence & Investigation, FBR, Lahore.

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.

August 30, 2019
FBR notifies transfers, postings of chief collectors

KARACHI: Federal Board of Revenue (FBR) has notified transfers and postings of chief collectors of customs with immediate effect and until further orders.

The FBR notified transfers and postings of following officers of Pakistan Customs Service (PCS) in BS-20-21:

01. Ms. Zeba Hai Azhar (Pakistan Customs Service/BS-21) has been transferred and posted as Chief Collector of Customs Enforcement (Central), Lahore from the post of Chief Collector of Customs (Central), Lahore.

02. Dr. Fareed Iqbal Qureshi (Pakistan Customs Service/BS-21) has been transferred and posted as Chief Collector of Customs Appraisement (Central), Lahore from the post of Collector, Model Customs Collectorate of Preventive, Karachi.

03. Imtiaz Ahmed Shaikh (Pakistan Customs Service/BS-20) has been transferred and posted as Collector, Model Customs Collectorate of Exports, Custom House, Karachi from the post of Chief, Federal Board of Revenue (Hq), Islamabad.

04. Muhammad Saqif Saeed (Pakistan Customs Service/BS-20) has been transferred and posted as Collector, Model Customs Collectorate of Preventive, Karachi from the post of Collector, Model Customs Collectorate of Exports, Custom House, Karachi.

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.

August 29, 2019