Here Is A Complete Guide on How To File Income Tax Returns in Pakistan

Here Is A Complete Guide on How To File Income Tax Returns in Pakistan

If you have yet to file your income tax return for 2024, there is still time! According to the Federal Board of Revenue (FBR), individuals have until 30th September to file their income tax returns. Before you do so, however, you should be made aware of how to accurately and conveniently manage your tax data and file your income tax return. 

Before going over the details of the process, it is important to note the criteria as to who is bound to file an income tax return. If an individual: 
●    Has an annual income of Rs. 600,000 or more
●    Is a business owner
●    Is a property owner 
●    Is a vehicle owner
●    Is a National Tax Number (NTN) Holder
●    Is a High Electricity Consumer 
●    Is a resident with a foreign income
●    Is a registered professional
●    Owns a Non-Profit Organisation
●    Under Final Taxation

Here is a simplified guide on how to file your income tax returns and attain the maximum benefits of being a tax filer.

What Do You Need To File Income Tax Returns?
According to the Federal Board of Revenue (FBR), you require supporting documents for filing income tax returns. 
●    Phone number with SIM registered against your own CNIC
●    Email Address
●    Tax Deduction Certificate from the employer
●    List of Personal Assets along with their Value of Purchase/Acquisition
●    Evidence of Ownership of business premises (for business owners)
●    Paid utility bill of business premises not older than 3 months (for business owners)

How To File Income Tax in Pakistan – A Step By Step Procedure
The process of filing income tax returns online has become fairly easy. Now, anybody can easily file their taxes online by visiting the Federal Board of Revenue website. Here is how you can file tax returns in Pakistan.

HOW TO LOGIN TO IRIS PORTAL AND FILE INCOME TAX RETURNS

 

1. File income tax returns by first logging into Iris.

2. Enter your Username and Password. 

3. In case you forget your password, click on ‘Forgot password’ 

4. Once you have successfully logged into the portal, click on ‘Declaration’ menu at the top of the portal

5. Select the tab under Forms which states: ‘114(1) Return of Income Filed Voluntarily for 1 Year)’

6. Click on the Period tab, where you have to enter the Tax year.

 

 

 

 

EMPLOYMENT SECTION
●    Now, a page will open up, where you click on the ‘Employment’ section
●    Select Salary Tab
●    Enter the annual income in salary in the Total Amount section
●    If the salary you have includes the amount that is exempted from tax mention it under the heading ‘Amount exempt from tax’  
●    Once you are done click on Calculate button
●    Provide total tax, the amount exempt from tax, and subject to final tax in input fields, and then click on the Calculate button

ADJUSTABLE TAX AND THE AMOUNT OF TAX DEDUCTED
●    Click on the Tax Chargeable/Payments tab and select the Deductible Allowances tab where any amount that is deducted in the name of Zakat or charitable donations should be entered
●    Fill out the Tax Chargeable, Tax Reductions, Adjustable Tax, and Tax Credits field
●    On the Adjustable Tax screen, you need to fill out the details of the taxes that have already been taxed or charged to you during your tax year
●    If you are a federal government employee, then enter the tax amount against the 64020001 code
●    For provincial government employees, enter the tax amount against 64020002
●    If you are a corporate sector employee, then enter your tax amount against the 64020003 code
●    You can also adjust the tax deducted by your bank on various sections like when you withdraw cash from a bank in 64100101. Other banking transactions like any bonds or savings should be entered in the code 64151501.
●    You can also adjust the tax deducted by your bank on motor vehicle registration fees, transfer fees, sales, and leasing against their respective codes
●    A dialogue box shall appear asking for vehicle details like E&TD Registration No. and provide further details related to its make, model, and engine capacity. Once you are done with it then click on the Calculate Tab button.

TAX CHARGEABLE/PAYMENTS
●    Select the Tax Chargeable/Payments tab and you will see all the details of your income and chargeable tax
●    Check out the tabs Admitted Income Tax and Demanded Income Tax
●    If you find any amount against the Demanded Income Tax tab then you must pay it and attach the relevant CPR

NET ASSETS
●    Click on the Personal Assets menu to provide information about your assets
●    Enter the total amount for the previous year's net assets and also for the current year
●    Enter the amount of annual income in the inflows and outflows field
●    Click on the Calculate button after filling out all the details
●    The ‘Unreconciled Amount’ must be zero when submitting income tax returns

PAYMENT FOR DEMANDED TAX
●    When you have paid the Demanded Tax either through the Alternative Delivery Channel (ADC) or through cash by visiting any authorized branch of the National Bank of Pakistan, then you need to submit the details of your returns in the following steps
●    Select the Payments tab and click on the + sign in the top right corner
●    A dialogue box shall appear asking for payment details
●    Enter CPR no. Amount Code or Paid Amount and click on the search option
●    The entire list of details of your payment will appear, click on the OK button and then save

VERIFY THE INCOME TAX RETURN FORM AND SUBMIT IT
●    Once you have added and calculated all required fields, you should now verify your identity.
●    Your name and registration number shall already be populated
●    Enter the verification pin that was given to you at the time of registration and click on the Verify Pin tab
●    Once you are given the details, you can now file income tax returns by clicking on the Submit tab
 

This comprehensive guide serves as an initial step for individuals genuinely seeking to contribute to Pakistan’s welfare and fulfill their civic responsibilities as responsible citizens. We trust that this guide has provided you with valuable guidance in the right direction.