Increase in refund claims by registered persons selected for audit

KARACHI: Federal Board of Revenue (FBR) has selected sales tax audit of those sales tax registered persons whose refund claims increased in a month over the corresponding month last year.

According to risk parameters for selection of audit under Audit Policy 2018, the FBR selected audit cases through computerized balloting of those registered persons whose refund claim increase during a month over the corresponding month last year.

The FBR also randomly selected those cases where decline in value of supplies as compared to corresponding months of previous year.

Besides consistent increase in input tax/output tax ratio over corresponding months of previous three years were also selected through random balloting.

Other risk parameters are included:

Decrease in taxable supplies to total supplies ratio as compared to corresponding months of previous year.

Difference in declared value of sales as compared to declared turnover in Income Tax Return.

Persons declaring reduced rate sales.

Manufactures showing inadequate value addition.

Declared sales are less than imports

Decrease in payment of tax as compared to corresponding months of previous year.

Increase in refund claimed as compared to corresponding months of previous year.

Unclaimed purchase to declared purchases ratio is high.

Utilities to sales ratio is high.

Discrepancy identified by CREST.

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