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Income Tax Return Filing Hits New Record High

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Income Tax Return Filing Hits New Record High

The filing of income tax returns has risen to a new record high of 2.76 million as people adhere to the List of registered taxpayers (ATL) in order to avoid 100 percent extra tax on those who don’t.

On the basis of returns filed for the fiscal year 2018 until 12 January 2020, income tax return filing rose to 2.76 million

The unprecedented increases in return filing have been traced to sources in Federal Revenue Board (FBR) by the Finance Act of 2019 for the alteration of the Revenue Tax Order 2001.

A new Tenth Schedule in the Income Tax Ordinance 2001 was implemented in the last budget for 2019/2020, whereby people who do not appear on the ATL will pay 100% more penalty fees on certain transactions.

The ATL for the tax year 2018 released by those taxpayers who filed their returns by the due date was issued on 1 March 2019. 1,59 million names were included

Later on, due to the introduction of an amnesty program, the FBR issued extensions of date for filing returns.

With the introduction of the 10th schedule of the 2001 taxation ordinance, taxpayers will speed up filing of returns so that the tax rate for certain transactions is no longer higher.

According to that, people were not allowed to appear on the ATL unless they submitted their annual returns after their due dates. Nevertheless, the main law has been added another clause under which individuals may add their ATL name by paying a penalty.

The FBR has therefore issued around 260,000 tax returns for 2018 to 12 January 2020 from 9 August 2019 onwards.

From 1 March 2020 the FBR will issue ATL for fiscal year 2019 and, by this time, the existing ATL for withholding tax rates for some transactions will apply.

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