Taxationist Corporate Consultants

Who need to file income tax return in Pakistan? | Who need to get NTN from FBR?
Who is required to file tax return in Pakistan?
All individuals (including salaried persons) are required to file their return/wealth statement for the year ended 30 June by 30 September. Late filing shall be liable to penalty proceedings.
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How to remove Blacklisting/ Suspension of Sales Tax Registration?
Section 21 of the Sales Tax Act 1990, and Rule 12 of the Sales Tax Rules, 2006 explained the blacklisting and suspension of sales tax registration.

The Commissioner may suspend/black list a registered if satisfied that the he has issued fake invoices, evaded tax or committed tax fraud.

Before initiating any action to blacklist or suspend any registered or enrolled person, the Collectorate shall make efforts to confirm the facts and veracity of the information. In case of reported non-availability at the given address, it may be checked from the Registration Division whether the person submitted any information about change in address, the given address may be visited by an officer of the Collectorate, or an attempt may be made to trace the person from documents such as National Identity Card, income tax records, bank account, etc. In case of reported non-access to the premises and/or non-production of record, a notice may be issued through registered post to the person to allow access/produce records, clearly indicating that refusal or delay will result in blacklisting or suspension of his registration/ enrollment.

If the Collector is satisfied that the person needs to be blacklisted or his registration/enrolment suspended, he shall issue an order for the same, mentioning reasons for such blacklisting/suspension. Copies of the order shall be endorsed to the person concerned, all other Sales Tax Collectorates, the Sales Tax Wing computer system and the STARR system. Each Collectorate shall circulate all such lists to their refund, audit and other concerned staff to ensure that no refund is paid or input adjustment is taken on invoices issued by such suspected persons.

Now we will discuss the procedure/reasons for suspension/blacklisting as per Sales Tax Rules 2006.






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WHAT IS THE DIFFERENCE BETWEEN ADVANCE TAX & WITHHOLDING TAX IN PAKISTANI TAX SYSTEM?
Withholding is an act of deduction or collection of tax at source, which has generally been in the nature of an advance tax payment.
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Which income taxes are refundable in pakistan? | Refundable & Adjustable taxes from FBR?
In Pakistan, income tax refund can be claimed by individuals, associations of persons, or companies who have paid more tax than their actual income tax liability during a tax year. However, there is one basic criterion to claim the income tax refund, which is to file the income tax return. Refunds are not claimable by any other way. The only other option is to adjust such excess tax against one's salary tax deduction, which is only available to salaried individuals.
The amount of refund visible on one's income tax return form may vary. Taxpayers can either ask for all the amount to be refunded to their account via lodging an online application under section 170, or the same amount can be adjusted against tax liability of future years.
Adjustable taxes can be claimed in three ways:
These can be adjusted in the current tax year.
Refunds can be claimed.
These can be carried forward to be adjusted in the next tax year as well.
The other two types of taxes deducted are final tax and minimum taxes. All the taxes deducted under goods or services nature are final in nature. Except for manufacturers and the companies listed on stock exchange for which these are adjustable. The minimum taxes are only adjusted against current year liability and cannot be carried forward or claimed as a refund.
It is important to note that income tax refunds are subject to verification by the tax authorities. The verification process may take some time, so it is advisable to keep all the relevant documents and records ready for submission if required.
In conclusion, claiming income tax refund in Pakistan is possible if the taxpayer has filed the income tax return and paid more tax than their actual income tax liability during a tax year. The process may take some time, but with the right documentation and records, it can be a smooth process. It is also important to stay updated with Pakistan tax laws and regulations to avoid any legal issues.

The FBR highlighted Rule 12A of the Sales Tax Rules, 2006, which defines the status of non-active taxpayers and outlines the consequences of falling under this category. According to the rule:

1. Automated Classification as Non-Active Taxpayer: A registered person failing to meet the conditions specified in clause (1) of section 2 of the Act will automatically be classified as a non-active taxpayer. Subsequently, their name will be removed from the active taxpayers list maintained by the Board.

2. Restrictions for Non-Active Taxpayers: Non-active taxpayers will face several restrictions, including the inability to:
• File Goods Declarations for import or export.
• Issue sales tax invoices.
• Claim input tax or refund.
• Avail any concessions under the Act or rules made thereunder.

3. Purchasing Restrictions: No person, including government departments, autonomous bodies, and public sector organizations, will be allowed to make purchases from a non-active taxpayer.

4. Input Tax Credit Limitations: If a registered buyer includes an invoice issued by a non-active taxpayer in Annexure-A of their return, a message will appear indicating that the supplier is a non-active taxpayer. Furthermore, no input tax credit will be admissible against such an invoice.
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WHO IS ELIGIBLE FOR INDEPENDENT TAX PRACTICE IN PAKISTAN? | TAX PRACTICE IN PAKISTAN?
WHO IS ELIGIBLE FOR INDEPENDENT TAX PRACTICE IN PAKISTAN?
CA
ACMA
LLB
ITP

FBR to integrate real time data of 145 entities to document the economy & broadening the tax base.
The FBR has issued an SRO 1771(I)/2023 to introduce draft amendments in the Income Tax Rules 2002 here on Tuesday.

The FBR will document economic transactions carried out by 145 organisations to assess actual income and tax potential of citizens and collect the due amount of taxes from them.

The purpose is to document economic transactions covering transactions for exchange or transfer of title or ownership of assets, goods or services involving economic value provided by one person to another person, a senior FBR official said.

In this regard, the FBR has directed these 145 organisations to integrate with FBR’s “real-time accessed data analysis repository (RADAR)” for providing real time access to information and database.

The organisations required to provide real time access to relevant information and database included State Bank of Pakistan (SBP), commercial banks, Pakistan Stock Exchange, investment banks, Non-Banking Financial Companies (NBFCs), micro-finance banks, Accountant General Pakistan Revenues, Military Accountant General, Rawalpindi Military Lands & Cantonment Headquarters, Rawalpindi and provincial revenue authorities/ boards, Association of Builders and Developers (ABAD), all Bahria Town Private Limited Companies, and all Defence Housing Authorities (DHAs).

The new procedure shall provide for real time access to information and database to the Board by the organisations. The FBR has also issued a list of agencies, authorities, institutions and organizations including their attached departments, divisions, wings, institutes, sub-offices, autonomous bodies by whatever name called, are required to integrate with the Board’s RADAR and shall furnish information under section l75A of the Income Tax Ordinance.

Every integrated organization shall integrate with Board’s RADAR not later than January 15,2024 or such date as notified for integration of such organization in order to provide real time access to information and database relating to economic transactions as carried out by any person with the or reported to the said integrated organization.

The “real-time accessed data analysis repository (RADAR)” means Common Transmission System or IT platform specifically designed, installed and integrated by the Board with the IT platform of the integrated organization for the purposes of real-time access to information and database.

Until real-time access to information and database is made available, such information and data shall be provided periodically in such form, manner and by such date as may be specified by the Board through instructions on case to case basis.

Every integrated organisation which is required to furnish information as specified in this chapter shall provide true, correct, authenticated and complete information, FBR said.

The integrated organisation which is found to have tampered with the IT platform or fails to integrate with the Board’ RADAR, or refuses to furnish the information there-under or furnishes false, incorrect, incomplete, or unauthenticated information, the principal accounting officer or the principal officer of such organization shall be personally responsible for such default and shall be liable to a penalty and/ or prosecution, in accordance with the relevant provisions of the Income Tax Ordinance.

The Board shall periodically conduct inspection of the integrated organization to ensure that the integrated organisation is complying with these rules, FBR added.

What is list of taxes deducted in GDs| Taxes Included in GDs?| Adjustable taxes on Imported GDs?.














What is list of taxes deducted in GDs| Taxes Included in GDs?| Adjustable taxes on Imported GDs?

Sales Tax on Goods In Pakistan? | Tax on Services in Pakistan? | Provincial Sales Tax On Services.
VAT (locally termed as 'sales tax') is ordinarily levied at 18% on the value of goods, unless specifically exempt or subject to sales tax at a reduced rate, after allowing related input credits. Sales tax on services is levied by Islamabad Capital Territory, Azad Jammu, and Kashmir at rates ranging from 13% to 16%.

Consequences of the Filing Unnecessary Nill Income Tax Return? | Filing of Nill Income Tax Return.

A nil income tax return is filed to show the Income Tax Department that you fall below the taxable income and therefore did not pay taxes during the year. A nil return is an ITR filed specifically to declare to the Income Tax department that no taxes have been paid in the respective financial year.

FBR Intended to collect Income Tax From Retailers Through Electricity Bills |
The Federal Board of Revenue (FBR) has announced a new method for retailers to pay their income tax through their monthly electricity bills. This significant change is part of the updated Income Tax Ordinance, 2001, which became effective from July 1, 2023.

Under the revised ordinance, Section 99A outlines the procedure for collecting income tax from retailers using their electricity connections. This provision is specifically designed for retailers other than Tier-I retailers, as defined in the Sales Tax Act, 1990 (VII of 1990), and specified service providers who are using commercial electricity connections.

Key points from Section 99A of the Income Tax Ordinance include:

Tax Collection: Income tax will be charged and collected from eligible retailers via their commercial electricity connections. The rates at which this tax will be collected are specified in the income tax general order issued by the FBR.

FBR’s Authority: The Federal Government or the FBR, with approval from the Minister in-charge following the Economic Coordination Committee of the Cabinet’s approval, can issue an income tax general order. This order will cover various aspects, including the scope, timing, payment, recovery, penalties, default surcharges, adjustments, refunds, and more, related to the tax payable under this section.

Collection Methods: The order can specify whether tax should be collected based on the amount of the electricity bill or on any consumption basis. It may also specify rates, conditions, and effective dates for the tax collection. Additionally, it may outline the record-keeping, filing of returns, statements, and assessment procedures.
Mechanism and Application: The order can provide mechanisms for the collection, deduction, and payment of tax for individuals or groups. It can also determine which persons or classes of persons, as well as types of income or classes of income, are included or exempted from this section.

Adjustability: The order can specify whether the tax collected under this section is adjustable, final, or minimum concerning any income, to what extent, and under what conditions.























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