- Penalties, fines will not be imposed on late filers
- 2.4 million people filed tax returns by January 15
KARACHI: Federal Board of Income (FBR) has determined to not impose a penalty on late filers throughout the board owing to technical and non-technical hurdles within the submitting of returns.
Sources advised The Information that the board softened its stance on the imposition of penalty on revenue tax returns late filers for the tax 12 months 2020-21. Though, the tax authority hasn’t imposed any high-quality but the penalty has been below dialogue for some time.
“Fines and penalties on late filers are not meant to boost revenue collection but used as a tool to deter against late filing,” stated Ashfaq Ahmed, a member of the Inland Income Operations on the FBR.
Sources aware about the event quoted him as saying this throughout a gathering with Karachi Tax Bar Affiliation (KTBA) on revenue tax returns for the tax 12 months 2020-21.
The FBR official stated late filers had been liable to fines and penalties however the board could determine on a case-to-case foundation.
It could be added right here that the final date for revenue tax returns was December 8, 2020, for salaried and enterprise people, taxpayers falling below the ultimate tax regime, and corporations with a particular tax 12 months.
The final date to file returns for company taxpayers was December 31, 2020. No additional extension has been granted.
The income physique acquired round 1.8 million tax returns by December 8, 2020, and directed all tax officers to grant extension in date to taxpayers who submit purposes to the Commissioner Inland Income.
By January 15, the variety of revenue tax return filers has elevated to 2.4 million.
Part 182 of the Earnings Tax Ordinance 2001 explains the penalties for late filers.
If a person fails to furnish a return of revenue, they’re liable to pay equal to 0.1% of the tax payable in respect of that tax 12 months for every day of default topic to a most penalty of fifty% of the tax payable supplied that if the penalty labored out is lower than Rs40,000, or no tax is payable for that 12 months such particular person shall pay a penalty of Rs40,000.
“Provided that if 75 percent of the income is from salary and the amount of income under salary is less than five million rupees, the minimum amount of penalty shall be Rs5,000,” learn the regulation.
Equally, if an individual fails to furnish a wealth assertion, which is obligatory to file together with the return of revenue, by the due date then such a person pays a penalty of 0.1% of the taxable revenue per week or Rs100,000 whichever is larger.
The tax official knowledgeable the KTBA the FBR is taking strict motion towards non-filers and can provoke prosecution towards non-compliant taxpayers.
The KTBA officers stated many taxpayers have real causes for late submitting. Due to this fact, the FBR ought to take a lenient view and withdraw the penalty on returns filed after the due date.