Islamabad, August 11, 2025 – The Federal Board of Revenue (FBR) has issued an official clarification on the definition of a taxpayer in Pakistan for the tax year 2026 (July 2025 to June 2026), aiming to remove ambiguities for individuals and businesses regarding their tax obligations.
According to the FBR, a taxpayer in Pakistan is any person who derives an amount chargeable to tax under the Income Tax Ordinance, 2001. This broad definition covers both individuals and entities, ensuring that all income-generating activities fall within the tax net.
The explanation further states that a taxpayer includes:
(a) any representative of a person who earns an amount subject to tax in Pakistan;
(b) any person obligated to deduct or collect tax under Part V of Chapter X and Chapter XII of the Ordinance; and
(c) any person required to file a return of income or pay tax under the law.
The FBR emphasized that being a taxpayer is not limited to those who directly earn taxable income—responsibilities also extend to those handling tax deductions, collections, or filing requirements on behalf of others.
By clarifying this definition, the FBR aims to improve compliance, enhance documentation, and strengthen Pakistan’s revenue collection framework. The move is expected to help citizens and businesses understand their legal responsibilities, reduce disputes, and ensure a fairer tax system.