Late Filers Will No Longer Be Part of the Active Tax Payers List: FBR

The Federal Board of Revenue (FBR) will erase late filers from active taxpayers list (ATL), according to the officials.

Late filers will be treated as non-filers, meaning that they won’t be able to avail benefits of reduced withholding tax rates, officials from FBR told the media as last date of filing is fast approaching by the end of the current week.

A senior FBR official said if an individual fails to file income tax return for tax year 2018 by the due date, he/she will not be included in the ATL, which will be issued on March 1.

Taxpayers criticized the FBR for the decision and called for its withdrawal as it would result in massive exits from the ATL.

They said there will be no attraction for taxpayers to file returns in such a case and the number of return filers will drastically come down.

The FBR received around 46 percent of returns for tax year 2017 after due date, but they were considered part of ATL. FBR received an estimated 1.07 million returns for tax year 2017 till December 15, 2017. Currently, there are 1.57 million filers in the ATL.

Abdul Qadir Memon, president of Pakistan Tax Bar Association (PTBA), said that taxpayers are in a very difficult situation as there are glitches on the online returns filing system. The FBR has yet to upload the income tax return forms for companies.

“The FBR needs to extend the last date for filing returns in order to provide statutory time limit,” PTBA president said. The FBR should also withdraw the provision of late filing because it would be counterproductive to broadening the tax base.

The FBR official, however, said the law was introduced to create discouragement against the habit of late filing and discourage frequent extension of time limit.

The official further said the taxpayers will not be entitled to carry forward any loss to the tax year for which return of income is filed late, under the law.