Company Registration, Income Tax & Sales Tax Lawyers in Karachi & Islamabad

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Income Tax Return Filing
No.1 Expert Income Tax Lawyers in Karachi & Islamabad

Income tax Return Filing Lawyers in Karachi & Islamabad, Pakistan

Income Tax Return: No. 1 Income Tax Returns Filing Lawyers in Karachi and Islamabad, Pakistan. Efile FBR Income Tax Annual Returns in time and become a Filer & get the benefits of being an income tax filer and avoid becoming an income tax non-filer. 

The last date for filing an income tax return is 30th September of the subsequent year (for example, the last date of filing a tax return for TY 2021 was 30th June 2021). If you fail to file a tax return till the due date, you will have to pay a penalty which is the half percent of tax payable per month until the filing is completed but not more than Rs. 20,000 in total.

You can file your income tax returns either manually through the FBR office or electronically through their website. The instructions and requirements differ based on various criteria such as whether an individual has been notified or not by FBR, whether an individual has been audited in previous financial years etc.

 

Annual Income Tax Return Filing

Income tax is a levy on income earned inside the country, which means it affects anyone who works as an employee. 

The main items of income that form the basis of income tax returns are:

  • Salaries received both inside and outside Pakistan by foreign employees
  • Capital gains or losses made on the sale of properties or  investments held within Pakistan (i.e. stocks and other assets)

The Income Tax Ordinance, 2001

 The tax laws in Pakistan are defined in the Income Tax Ordinance 2001. The Federal Board of Revenue (FBR) is responsible to regulate the taxation system in the country. For documenting tax returns, a person must have NTN registration.

The taxation structure of a country determines the strength of the economy. Under the law, it is the responsibility of Pakistani citizens to declare their assets, document their annual tax returns, and pay due taxes timely. The new tax reforms are announced a while ago, to restructure the taxation system in Pakistan by making it easier, simpler, and convenient to get people under the tax net by encouraging them to document tax returns and pay the due taxes timely.
A common misconception is revolving among people that tax paying is optional. But, actually, tax evasion is a criminal offense and the tax evader may be penalized for the violation of the law.

Income Tax Registration - NTN

The National Tax Number (NTN) is a number issued to every registered person or business in Pakistan under the Income Tax Ordinance, 2001. It is used by the Federal Board of Revenue (FBR) as a tracking number for income tax and other taxes.

It is required that anyone earning above Rs. 400,000 per year will have to register with FBR and get their NTN. Any company that has an annual turnover of more than Rs. 3 million will also have to be registered with FBR and obtain NTN.

What has to pay Income Tax?

Income Tax Ordinance 2001, implies that every person having any kind of legal income is liable to pay taxes for every tax year, based on the rates declared by the government.

Who are Non-Filers?

Income Tax is a process of tax collection from the income earned by individuals or organizations. Income Tax is the tax collected from all sources, including salaries, interest, rent, and dividends. Also referred to as direct tax collection by the government of Pakistan. Non-filers are those individuals who have not filed their income tax returns for the previous year. These individuals can be penalized because it is an unlawful act on their part that may lead to penalty charges or imprisonment.

Penalty on Non-Filers

Non-filers are subject to penalty charges which will be levied in accordance with section 41 of Pakistan Income Tax Rules 1999 or under section 99A(1)(b) (i) of Income Tax Ordinance 2001 as per the suitability of cases. The penalties imposed on non-filers will directly affect an individual’s well-being because if income tax is not paid then most likely due to some other reason such as an insufficient source of funds then one will also get into trouble and this means that you have no choice but to pay your taxes so that you may avoid such kind of trouble

What is a Tax Year?

The tax year is a twelve months period from 1st July to 30th June and shall be marked by the calendar year.

What is Taxable Income in Pakistan?

In order to determine Taxable Income, Total Income is subtracted from donations that qualify for deductions and certain allowances to be deducted. However, for business, taxable income may vary. Tax is applicable to all the profits earned by an organization.

Last date for Income Tax Return Filing

income tax sales tax

What are the Income Heads in Pakistan?

By Tax Ordinance 2001, the income is classified into five(5) different types which include Income from property, Salary, income from a business, income from any other sources, or capital gains on investments.

By Federal Budget of 2021-2022 presented by the Government of Pakistan, the following tax rates and tax slabs are applicable for salaried and non-salaried persons for 2021-2022:

TAX SLABS FOR SALARIED PERSONS

If an individual’s income is under the ‘Salary’ head exceeds 75% of its taxable income, the mentioned below tax rates will be applied:

Taxable Income Rate of Tax:

  1. If the taxable income remains below Rs. 600,000 – Income tax rate= 0%.
  1. If taxable income surpasses Rs. 600,000 but below to Rs. 1,200,000 – Income tax rate= 5% on the amount above to Rs. 600,000.
  1. If taxable income surpasses Rs. 1,200,000 but below to Rs. 1,800,000 – Income tax rate= Rs. 30,000 plus 10% on the amount above to Rs. 1,200,000.
  1. If taxable income surpasses Rs. 1,800,000 but below to Rs. 2,500,000 – Income tax rate= Rs. 90,000 plus 15% on the amount above to Rs. 1,800,000.
  1. If taxable income surpasses Rs. 2,500,000 but below to Rs. 3,500,000 – Income tax rate= Rs. 195,000 plus 17.5% on the amount above to Rs. 2,500,000.
  1. If taxable income surpasses Rs. 3,500,000 but below to Rs. 5,000,000 – Income tax rate= Rs. 370,000 plus 20% on the amount above to Rs. 3,500,000.
  1. If taxable income surpasses Rs. 5,000,000 but below to Rs. 8,000,000 – Income tax rate= Rs. 670,000 plus 22.5% on the amount above to Rs. 5,000,000.
  1. If taxable income surpasses Rs. 8,000,000 but below to Rs. 12,000,000 – Income tax rate= Rs. 1,345,000 plus 25% on the amount above to Rs. 8,000,000.
  1. If taxable income surpasses Rs. 12,000,000 but below to Rs.30,000,000 – Income tax rate= Rs. 2,345,000 plus 27.5% on the amount above to Rs. 12,000,000.
  1. If taxable income surpasses Rs. 30,000,000 but below to Rs.50,000,000 – Income tax rate= Rs. 7,295,000 plus 30% on the amount above to Rs. 30,000,000.
  1. If taxable income surpasses Rs. 50,000,000 below to Rs.75,000,000 – Income tax rate= Rs.13,295,000 plus 32.5% on the amount above to Rs. 50,000,000.
  1. If taxable income surpasses Rs.75,000,000 – Income tax rate= Rs. 21,420,000 plus 35% on the amount above to Rs. 75,000,000.

TAX SLABS FOR NON-SALARIED PERSONS:

If an individual’s income is under the ‘Salary’ head exceeds 75% of its taxable income, the mentioned below tax rates will be applied:

Taxable Income Rate of Tax:

1. If the taxable income remains below Rs. 400,000 – Income tax rate= 0%.

2. If taxable income surpasses Rs. 400,000 but under Rs. 600,000 – Income tax rate= 5% on the amount above to Rs. 400,000.

3. If taxable income surpasses Rs. 600,000 but under Rs. 1,200,000- Income tax rate= Rs. 10,000 plus 10% on the amount above to Rs. 600,000.

4. If taxable income surpasses Rs. 1,200,000 but under Rs. 2,400,000 – Income tax rate= Rs. 71,000 plus 15% on the amount above to Rs. 1,200,000.

5. If taxable income surpasses Rs. 2,400,000 but under Rs. 3,000,000 – Income tax rate= Rs. 250,000 plus 20% on the amount above to Rs. 2,400,000.

6. If taxable income surpasses Rs. 3,000,000 but under Rs. 4,000,000 – Income tax rate= Rs. 370,000 plus 25% on the amount above to Rs. 3,000,000.

7. If taxable income surpasses Rs. 4,000,000 but under Rs. 6,000,000 – Income tax rate= Rs. 620,000 plus 30% on the amount above to Rs. 4,000,000.

8. If taxable income surpasses Rs. 6,000,000 – Income tax rate= Rs. 1,220,000 plus 35% on the amount above to Rs. 6,000,000.

LOOKING TOWARDS GETTING INCOME TAX RETURNS FILED?

Under the strict government programs regulations, it has come greatly necessary that you’re completely biddable with Pakistan’s taxation system. Taxocrate is a league of professional tax advisers in Karachi and tax lawyers in Islamabad. We don’t just give tax consultancy but also aid you in tax deduction and insurance conditions in your favor. This will let you concentrate your energy and time on the core business conditioning. We’ve tax lawyers in Karachi and tax advisers in Islamabad who work in the following parts in the area of tax consultancy

– Individualities.
– Salaried Earner.
– Associations.
– Companies.
– Non-Profit Organization (NGOs).

We work by making a complete analysis of your accounts books, making your Income Statement, doing essential amendments (if needed), and finishing the Income Statement. After process completion, we demonstrate the Return of Income after discussion and getting approval from the customer.

TAXOCRATE SERVICES

We give you mentioned below high-quality tax consultancy services for your compliance with the tax regulations:
• The strategy development and planning of your tax filing.
• Documenting of your Tax returns.
• National Tax Number enrollment for tax correspondence with FBR.
• Dealing with Taxation Authorities like taking interpretations, documentations, and approval from FBR.
• Wealth statement Preparation.
• Electronic Challan Payment and Preparation.
• Filing and Preparation of other tax statements (if needed).
• give guidance in FBR audit and Conduct tax audit.
• Guidance and Advisory on day-to-day tax issues of the clients.
• Manage appeals and objections.
• Guidance on Tax Deduction.
• Refunds of Income-tax from the tax authorities for clients.
• Manage Tax exemptions for educational institutions and NGOs.

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