FBR issues rules for filing biannual withholding statement

ISLAMABAD: Federal Board of Revenue (FBR) on Wednesday notified amendments to Income Tax Rules, 2002 under which withholding agents are required to file withholding statements biannually instead monthly.

The FBR issued SRO 849(I)/2019 to amend Rule 44 of Income Tax Rules, 2002. The monthly withholding statement has been replaced with biannually statement. The facilitation has been granted considering huge workload on the withholding agents for providing details of deduction on monthly basis.

The government through Finance Supplementary (Second Amendment) Act, 2019 has already amended Section 165 tp the Income Tax Ordinance, 2001 and replaced the time period for submitting withholding statement.

However, rules were necessary to amend for implementation the change in the main statute.

As per the amendment:

“Every prescribed person collecting tax under Division II of this Part or Chapter Xll or deducting tax under Division III of this Part of Chapter Xll shall furnish statements under sub-section (l) as per the following schedule, namely:-

(a) in respect of the half-year ending on the 30th June, on or before the 31st day of July; and

(b) in respect of the half-year ending on the 31st December, on or before the 31st day of January.”

Under Section 165 of Income Tax Ordinance:

(1) Every person collecting tax under Division II of this Part or Chapter XII or deducting tax from a payment under Division III of this Part or Chapter XII shall, furnish to the Commissioner a biannual statement in the prescribed form setting out—

(a) the name, Computerized National Identity Card Number, National Tax Number and address of each person from whom tax has been collected under Division II of this Part or Chapter XII or to whom payments have been made from which tax has been deducted under Division III of this Part or Chapter XII in each half-year

(b) the total amount of payments made to a person from which tax has been deducted under Division III of this Part or Chapter XII in each half-year

(c) the total amount of tax collected from a person under Division II of this Part or Chapter XII or deducted from payments made to a person under Division III of this Part or Chapter XII in each half-year; and

(d) such other particulars as may be prescribed:

Provided that every person as provided in sub-section (1) shall be required to file withholding statement even where no withholding tax is collected or deducted during the period.

Explanation.— For the removal of doubt, it is clarified that this sub-section overrides all conflicting provisions contained in the Protection of Economic Reforms Act, 1992 (XII of 1992), the Banking Companies Ordinance, 1962 (LVII of 1962), the Foreign Exchange Regulation Act, 1947 (VII of 1947) and the regulations made under the State Bank of Pakistan Act, 1956 (XXXIII of 1956), if any, on the subject, in so far as divulgence of information under section 165 is concerned.

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