Do you need to file tax return?

Tax Return in Pakistan

A tax return is an official document that individuals and companies file with tax authorities, like Pakistan's Federal Board of Revenue (FBR), to disclose their income, expenses and their assets and liabilities.

In Pakistan, Who Is Required to File Tax Returns?

In Pakistan, following is a summary of the various taxpayer categories:

Individual Taxpayers:

Tax returns must be filed by those whose taxable income exceeds Rs. 600,000 per annum (as per latest tax law updated till 30 June, 2023).

The minimum taxable income threshold for individuals is subject to change based on current tax legislation. Taxpayers must remain informed on the most recent thresholds.

Companies and Organizations:

Regardless of taxable income, corporations, businesses, and other entities operating in Pakistan must file tax returns.

A business must nevertheless file a 'Nil' return, stating that it had no taxable revenue during the tax year, even if it does not produce any.

Non-resident Pakistanis:

Those who reside overseas but receive their income from Pakistan are known as non-resident Pakistanis or NRPs. In addition, they must abide by Pakistani tax regulations, and depending on their income sources, they could have to file tax returns.

Legal Compliance:

By filing tax returns, people and businesses in Pakistan can stay out of trouble by following the law and avoid penalties, fines, and legal repercussions for non-compliance.

How to file tax return:

In Pakistan, there are various procedures involved in filing tax returns, such as:

Registration: To file tax returns, taxpayers must register with the FBR and get a National Tax Number (NTN).

Obtaining Financial Information: To file taxes, taxpayers must acquire financial records, such as bank statements, income statements and expenses details.

Filling Out the Tax Return Form: Depending on their income sources and individual or corporation status, taxpayers must fill out the correct tax return form.

Return Submission: After completing the tax return, taxpayers have two options for submitting it: manually at authorized tax offices or electronically via the FBR's internet site.

In conclusion, understanding your tax obligations and abiding by the law is crucial for both individuals and organizations. Taxpayers can ensure compliance with Pakistan's tax regulations and handle the complexity of tax filing by consulting with the FBR or seeking counsel from Pak Tax Filer.