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Tag: sales tax registration

  • FBR allows raids against unregistered manufacturers, suppliers

    FBR allows raids against unregistered manufacturers, suppliers

    ISLAMABAD: Federal Board of Revenue (FBR) has given go ahead to directorate of intelligence and investigation for conducting raids against manufacturers and suppliers not registered under sales tax laws.

    In this regard the Directorate of Intelligence and Investigation, Inland Revenue carried out raids against three unregistered units in Gujranwala, said a statement issued by Federal Board of Revenue (FBR) on Thursday.

    The statement said that in continuation of a drive against un-registered persons involved in making taxable supplies who are liable to be registered under the Sales Tax Act, 1990, the Directorate of Intelligence and Investigation-Inland Revenue, Lahore has carried out action under Section 38 and 40 of the Sales Tax Act, 1990 after obtaining search warrants from the Area magistrate against the manufacturing/business premises of three un-registered units in Gujranwala on November 05, 2019.

    The three unregistered units were involved in manufacture and supply of taxable goods i.e. sanitary ware, detergents and household gas appliances.

    During the search carried out available record was resumed which is under scrutiny and further investigation in this regard is underway.

    “The Directorate General Intelligence and Investigation-Inland Revenue shall continue such operations in order to unearth unregistered units/businesses which are making taxable supplies without payment of due amount of sales tax and causing huge loss to the national exchequer,” the FBR said.

  • SRB suspends sales tax registration of Wateen Telecom

    SRB suspends sales tax registration of Wateen Telecom

    The Sindh Revenue Board (SRB) has suspended the sales tax registration of Wateen Telecom Limited due to the company’s failure to remit collected sales tax to the provincial treasury. The decision came after an audit revealed significant lapses in tax payments by the telecom provider.

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  • Sales tax registration made mandatory for buyers of ginned cotton

    Sales tax registration made mandatory for buyers of ginned cotton

    ISLAMABAD: Federal Board of Revenue (FBR) has made sales tax registration mandatory for persons buying ginned cotton.

    The FBR issued SRO 1087(I)/2019 and said that the person receiving ginned cotton shall pay sales tax and shall discharged the liability in the following manner:

    (a) the recipient of the supply of ginned cotton shall be duly registered under the Sales Tax Act, 1990, and the ginner shall not make any supply of ginned cotton to any person who is not so registered;

    (b) the ginner shall issue a tax invoice on the supply of taxable goods under Section 23 of the Sales Tax Act, 1990 indicating the value of taxable supply and the amount of tax due on such supply, along with other particulars as prescribed therein. The ginner shall also file the monthly return in accordance with the rules prescribed under the Act;

    (c) the tax invoice shall be issued of the date on which the ginned cotton was dispatched;

    (d) the recipient of ginned cotton shall deposit the tax due thereon under a payment challan indicating the name and registration number of supplier, along with the return for tax period in which invoice is issued for the relevant supply;

    (e) if the recipient fails to deposit sales tax payable on ginned cotton purchased by him by the due date for the relevant tax period, besides any other action which may be taken against him under the said Act, he shall not be entitled to claim adjustment or refund of input tax in respect of such purchase unless he pays the amount of additional tax or penalties chargeable on such late deposit under Section 33 and 34 of the said Act;

    (f) in case the ginner fails to declare the supply of ginned cotton in his return and same is detected during the course of an audit or otherwise, the amount due on such supply shall be recoverable from the ginner in accordance with the provisions of the said Act and the rules made thereunder;

    (g) the cases involving non-payment or short-payment of sales tax by a ginner or a recipient on supplies of ginned cotton made under the provisions of this notification shall be adjudicated by the officer having jurisdiction in the area where the contravention is made; and

    (h) in case a ginner deposits the tax due on the supply of ginned cotton, the same shall absolve the recipient from liability to pay tax on such supply under this notification.

  • SRB suspends sales tax registration of Chinese sanitation firm

    SRB suspends sales tax registration of Chinese sanitation firm

    KARACHI: Sindh Revenue Board (SRB) on Tuesday suspended sales tax registration of a Chinese sanitation firm for defaulting sales tax payment and failure to file monthly sales tax returns.

    The SRB issued notice on August 20, 2019 to suspend registration of M/s. Hangzhou Jinjiang Group Sanitation Services Co. Pakistan (Private) Limited.

    The provincial revenue body said that the company had failed to make payment of sales tax on services for the four consecutive months i.e. April, May, June and July 2019. Similarly, the company has also failed to comply with mandatory filing of monthly returns for the same months.

    The SRB in its notice informed the company that its sales tax registration had been suspended with immediate effect. However, suspension would be revoked if the company takes remedial measures of depositing outstanding amount and file all pending returns on or before August 26, 2019.

    The SRB warned that in case of non-satisfactory response or failure to take remedial measures as advised above on or before August 26, the matter shall be further proceeded for further necessary penal action under the Act, 2011.

  • Sales tax registration number is mandatory on invoices: SRB

    Sales tax registration number is mandatory on invoices: SRB

    KARACHI: Sindh Revenue Board (SRB) has said that mentioning Sindh Sales Tax Registration Number (SNTN) on sales invoices is mandatory for persons registered with the provincial revenue body.

    The SRB issued Circular No. 4/2019 on Tuesday and said it had received several enquiries from the taxpayers, registered with Sindh Revenue Board as service providers in terms of the provisions of sections 24, 24A and 24B of the Sindh Sales Tax on Services Act, 2011, about the requirement to mention Sales Tax Registration Number (STRN) on the sales tax invoices issued by the service providers to their customers/clients/service recipients.

    The levy, payment and collection of Sindh sales tax on services in Sindh Province is governed by the provisions of the Sindh Sales Tax on Services Act, 2011 and the rules and notification issued thereunder.

    Under rule 29(1) of the Sindh Sales Tax on Services Rules, 2011, all SRB-registered taxpayers/service providers are required to issue serially-numbered sales tax invoices to its customers/clients/service recipients containing the following particulars:-

    (i) Name, address and SNTN (Sindh Sales Tax Registration Number) of the service provider;

    (ii) Name, address and NTN or SNTN or CNIC number of the service recipient;

    (iii) Serial number and date of issue of the tax invoice;

    (iv) Description, tariff heading and other details of the service provided;

    (v) Value exclusive of Sindh sales tax;

    (vi) Rate of Sindh sales tax;

    (vii) Amount of Sindh sales tax; and

    (viii) Value inclusive of Sindh sales tax

    For the purposes of registration under the Sindh Sales Tax on Services Act, 2011, Sindh Revenue Board issues a SNTN (by prefixing alphabet “S” to the NTN of the person/business enterprise) which is the unique identification of every SRB-registered taxpayer/service provider. Neither the Sindh Sales Tax on Services Act, 2011 nor the rules made thereunder recognize any sales tax registration other than SNTN.

    No other registration number is issued/generated by the Sindh Revenue Board either. In compliance with the requirement of the aforesaid rule 29(1), all sales tax invoices issued in relation to the provision of taxable services have to mention the “SNTN”, as issued by the SRB.

  • SRB suspends sales tax registration of stock broker firm

    SRB suspends sales tax registration of stock broker firm

    The Sindh Revenue Board (SRB) has taken stringent action against a stock broker firm M/s. Reliance Securities Limited, suspending its sales tax registration due to a failure to fulfill tax payment obligations and non-compliance with filing monthly returns.

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  • FBR amends sales tax rules to implement automated registration system

    FBR amends sales tax rules to implement automated registration system

    ISLAMABAD: Federal Board of Revenue (FBR) has amended Sales Tax Rules 2006 to implement automated sales tax registration system.

    The FBR issued SRO 698(I)/2019 to amend Rule 5 of Sales Tax Rules, 2016. The amendment has been made in Rule 5 for sub-rule (2) to (9), the following shall be substituted, namely:

    “(2) The applicant having NTN or income tax registration shall, using his login credentials, upload following information and documents-

    (a) bank account certificate issued by the bank in the name of the business;

    (b) registration or consumer number with the gas and electricity supplier;

    (c) particulars of all branches in case of multiple branches at various locations;

    (d) GPS-tagged photographs of the business premises; and

    (e) in case of manufacturer, also the GPS-tagged photographs of machinery and industrial electricity or gas meter installed.

    (3) On furnishing above documents, the system shall register the applicant for sales tax.

    (4) After registration, the applicant or his authorized person shall visit e-Sahulat Centre of NADRA within a month for bio-metric verification. In case of failure to visit or failure of verification, the registered person’s name shall be taken off the sales tax Active Taxpayer List.

    (5) In case of manufacturer, the Board may require post-verification through field offices or a third party authorized by the Board.

    In case, the field office, during scrutiny after the registration, finds that any document provided is non-genuine or fake or wrong, it may request through the system, to provide the missing document, in fifteen days, failing which the registered person shall be taken off from the sales Active Taxpayer List, subject to approval of the Member (IR-Operations), FBR.”

    The automated sales tax registration will be applicable from July 01, 2019.

  • Automated sales tax registration to start from July 01: FBR

    Automated sales tax registration to start from July 01: FBR

    ISLAMABAD: Federal Board of Revenue (FBR) on Monday said that the automated system for sales tax registration will start from July 01, 2019.

    The following procedure has been proposed and the same shall replace the one as prescribed in sub-rules (2) to (8) of rule 5 of the Sales Tax Act, 1990:

    The applicant having NTN/income tax registration shall, using his login credentials, upload following information / documents:

    Bank account certificate issued by the bank in the name of the business.

    Registration / consumer number with the gas and electricity supplier.

    Particulars of all branches in case of multiple branches at various locations.

    GPS-tagged photographs of the business premises In case of manufacturer, also the GPS-tagged photographs of machinery and industrial electricity or gas meter installed.

    On furnishing above documents, the system shall register the applicant for sales tax, the FBR said.

    After registration, the applicant or his authorized person shall visit e-Sahulat Centre of NADRA within a month for bio-metric verification.

    In case of failure to visit or failure of verification, the registered person’s name shall be taken off the sales tax Active Taxpayer List.

    In case of manufacturer, the FBR may require post verification through field offices or a third party authorized by the Board.

    In case, the field office, during scrutiny after the registration, finds that any document provided is non-genuine / fake / wrong, it may request through the system, to provide the missing document, in fifteen days, failing which the registered person shall be taken off from the sales Active Taxpayer List.

  • FBR urged to allow one sales tax registration for multiple businesses

    FBR urged to allow one sales tax registration for multiple businesses

    KARACHI: Federal Board of Revenue (FBR) has been urged to allow multiple businesses on one sales tax registration for better documentation of the economy.

    In its tax proposals for budget 2019/2020, the Pakistan Tax Bar Association (PTBA) said that after amendment in Sales Tax Act, 1990, through Finance Act, 2008, FBR has directed to cancel multiple registrations under single proprietorship.

    It said that proprietor having two businesses faces with the dilemma to show his entire sales under one business, which is creating hardship for his customers in their respective returns.

    Moreover, tax department often raise queries as to how a registered person can raise a invoice relating one business if he is registered with the department under another ‘business category’.

    “FBR should issue necessary instructions to incorporate multiple business features in its web-portal to facilitate taxpayers,” the PTBA suggested.

    The PTBA said that by implementing this suggestion it would result in better documentation of economy and proper maintenance of records of taxpayer.

    Highlighting another issue, the PTBA said that the definition of time of supply as amended through the Finance Act, 2013 stating receipt of advance as subject to sales tax, has created number of practical problems because of which sales tax on advance was earlier withdrawn by Finance Act 2007.

    The registered persons besides other practical issues has to undertake a tremendous exercise of reconciliation between the books of account where sales is recorded on the basis of delivery of goods with the sales tax returns where sales tax is paid on advance receipts.

    Furthermore, this also leads to discrepancies in CREST resulting in hardships to taxpayers as well as to the department.

    Therefore, the tax bar proposed withdrawal of the amendment made through the Finance Act, 2013.

    It said that it will help taxpayers to avoid unnecessary hassle as well as for the department; as charging of sales tax on advance receipts will not create any additional revenue for the Government.

    The PTBA also pointed out ‘hire purchase’ transaction involves periodical installments received/earned over a period of time.

    Currently, Sales Tax is being charged on full amount at the time of signing (entered into) of hire purchase agreement.

    The registered is burdened with increased amount of output tax on hire purchase sale at the time of sale although the amount is received from the customers in installments.

    Definition of time of supply’ may be amended and tax should not be levied at the time of signing of HP arrangement.

    Instead, tax should be levied at the time when installment is effected / paid.

    Further, the element of interest embedded in such installment should also be excluded for assessment of sales tax.

    Charging sales tax on full amount at the signing of hire purchase agreement is not justified and is in conflict with the definition of value of supply which states that it is the consideration which the supplier receives from the recipient for the supply.

  • SRB suspends sales tax registration of Multinet Pakistan

    SRB suspends sales tax registration of Multinet Pakistan

    KARACHI: Sindh Revenue Board (SRB) has suspended sales tax registration of M/s. Multinet Pakistan (Pvt.) Limited for defaulting tax payment and non-compliance in filing monthly sales tax return.

    Multinet Pakistan, is one of the premier information and communication solution providers for leading enterprises in the region.

    A notification issued by the SRB, stated that the company had failed to make payment of Sindh Sales Tax on Services pertaining to the tax period from April 2019 and also failed to e-file Sindh Sales Tax return for the same period.

    The SRB said that non-payment of Sindh Sales Tax and non-filing of SST return within the time and manner prescribed under the law is contravention of aforementioned provision of the Act, 2011 and the rules made there under.

    The SRB further said that the record available including the input tax claimed by the recipients of services shows that the company had charged and collected the Sindh Sales Tax amount, however, failed to deposit the same into the Sindh government head of account.

    “This is serious violation of the provisions of the Act.”

    “It has also been observed that the registered person has built up the habit of late deposit of tax and late filing of returns,” said a letter of suspension issued Vicky K. Dhingra, Assistant Commissioner (Unit 01), SRB.

    The SRB directed the company to discharge all its sales tax liability along with default surcharge besides file the true and correct monthly Sindh sales tax return for the tax periods by June 11, 2019.

    “In case of non-satisfactory response or failure to take remedial measures as suggested on or before June 11, 2019, the case would be further proceeded for cancellation of the registration with the SRB.