KARACHI: Tax practitioners have urged the Federal Board of Revenue (FBR) to allow withholding agents to file separate statements for salary and other than salary cases.
At a pre- budget 2021/2022 seminar the tax practitioners of Karachi Tax Bar Association (KTBA) highlighted following difficulties that are being faced by the taxpayer while filing withholding statement through IRIS:
► The taxpayer has to determine finality or adjustability of taxes withheld before filing the statement through IRIS. This is a very difficult task for every taxpayer and as such this condition was not a part of the previous system.
► Earlier the withholding statements were available in two formats one for deduction of tax on salaries and other for remaining sections. In that situation statement relating to salary was filled in by HR Department of all medium and large organization. Due to the merger of two separate portions in one statement it is now required to file the entire withholding data through one module.
► If a person has deducted and deposited the tax in the government treasury, collected from a taxpayer who has subsequently been granted, exemption certificate, the IRIS, does not allow the withholding agent to report the tax deducted or collected through the system.
► Moreover, it is not the duty of the withholding agent to determine adjustability or finality of tax deducted by him; because it is to be determined by the payee, therefore this condition may be removed from system.
► In view of the above, withholding agents may be allowed to file separate statements for salary and other than salary cases.
► Withholding agents should also be allowed to report tax deducted or collected in those cases, where subsequently exemption certificates are issued.
► Taxpayers should have access to details of income tax withholding made against their NTN and also the details of withholding agents within 24 hours of generation of CPRs.
This will assist the taxpayer:
(a) in knowing the amount of taxes paid to the Government Exchequer against their names;
(b) at the time of working out the estimates of advance tax liability and also while filing the return of income;
(c) in following up for the CPRs from the withholding agents;
(d) in compliance to the tax notices specially section 161; and
(e) to avoid undue negotiations at the time of obtaining exemption certificates.
