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August 14, 2020

FBR warns taxpayers of penal action for not updating profile

Business

August 14, 2020

KARACHI: The Federal Board of Revenue (FBR) on Thursday warned taxpayers of penal action against failure to update profile and mandatory detailed information.

The FBR said that through budget 2020/2021 a new amendment was introduced, under which taxpayers were required to update their profile by providing required information.

The FBR said persons who registered with the tax authorities up to September 30, 2020, and were driving income under various heads, were required to file profile up to December 31, 2020.

“Persons who obtain their registration after September 30, 2020 will require furnishing such profile within 30 days of the registration,” it added.

The profile should contain information relevant to income regarding bank accounts, utility connections, and business premises, including all manufacturing, storage or retail outlets operated or leased by the taxpayer, types of businesses and other such information.

The revenue body said that if a person fails to update profile within the due date, such person would not be included in the Active Taxpayers List (ATL) for the latest tax year ending prior to the aforesaid due date.

“However, upon filing or updating the profile, such persons shall be allowed to be placed on the ATL upon payment of surcharge which will be Rs20,000 in case of a

company, Rs10,000 in case of an association of persons (AOPs) and Rs1,000 in the

case of an individual,” the FBR said.

Further, a penalty for non-filing or not updating of profile is also recommended at Rs2,500 for each day default subject to minimum penalty of Rs10,000.

The FBR also explained another issue introduced through Finance Act 2020 regarding agreed assessment.

The FBR said that in order to facilitate taxpayers and reduce the burden on the formal appeal system, an amendment had been introduced under which where a taxpayer in response to a notice intends to settle his case, he may file offer of settlement before an Assessment Oversight Committee for resolution of his dispute.

The oversight committee would comprise of the chief commissioner Inland Revenue, the commissioner Inland Revenue and the additional commissioner Inland Revenue having jurisdiction over the taxpayer.

The FBR said the oversight committee would have mandate to resolve the issue after intention shown by the taxpayer.

Where the issue has been settled through this negotiation mechanism, the taxpayer should deposit the amount of tax payable along with

any penalty or default surcharge.

“The taxpayer shall waive his right to appeal and no further proceedings shall be taken against the taxpayer on the issues settled by the committee and accepted by the taxpayer,” the revenue body said.