Becoming a tax filer in Pakistan is essential for individuals and businesses who want to meet their tax obligations and stay compliant with the law. In this blog post, Graana.com will provide a step-by-step guide to becoming a tax filer in Pakistan.
What is a Tax Filer?
A tax filer is a person or entity responsible for submitting a tax return to the government, reporting their income and any taxes owed for a given tax year. This includes individuals, businesses, trusts, estates, and other entities. The tax filer uses the information provided in the tax return to determine their tax liability and to ensure compliance with tax laws and regulations.
Overview of Tax filer in Pakistan
In Pakistan, a tax filer is a person or entity required to file a tax return with the Federal Board of Revenue (FBR). This includes individuals, companies, and other types of entities liable to pay taxes in the country.
The tax return provides information on the tax filer’s income and any taxes owed, which the FBR uses to calculate the tax liability and enforce compliance with tax laws and regulations. Becoming a tax filer in Pakistan involves registering with the FBR, obtaining a tax identification number (TIN), and submitting regular tax returns as required by law.
How to check tax filer status
You can check your tax filer status in Pakistan by following these steps:
- Visit the Federal Board of Revenue (FBR) website: The official website of the FBR is www.fbr.gov.pk.
- Click on the “Online Services” tab: Look for the “Online Services” tab on the FBR website and click on it.
- Select “Filer Status Inquiry”: From the list of online services, select “Filer Status Inquiry.”
- Enter your National Tax Number (NTN): You will be prompted to enter your National Tax Number (NTN), a unique identifier assigned to tax filers in Pakistan.
- Check your filer status: After entering your NTN, the FBR website will display your current filer status, indicating whether you are a tax filer, a non-filer, or a provisional filer.
- Note: If you are not a tax filer, you can register with the FBR by following the appropriate procedures and submitting the necessary documentation.
How to Become a Filer in Pakistan
Follow these instructions to become a filer in Pakistan.
Step 1: Determine Eligibility
Before becoming a tax filer in Pakistan, you must determine if you can file taxes. Individuals who earn taxable income, companies, and other entities that carry out business activities in Pakistan must file taxes. If you are still determining eligibility, you can consult a tax professional or visit the Federal Board of Revenue (FBR) website for more information.
Step 2: Register with the FBR
To become a tax filer, you must first register with the FBR. This involves filling out an application form and submitting it with the required documents, such as a copy of your national identity card or business registration certificate. You can submit your registration application in person or online through the FBR’s e-portal.
Step 3: Obtain a National Tax Number (NTN)
Once registered with the FBR, you will be assigned a National Tax Number (NTN), a unique identifier for tax filers in Pakistan. Your NTN will be used for all your tax-related transactions, including filing tax returns.
Step 4: File Tax Returns
Once you have obtained your NTN, you must file regular tax returns with the FBR to report your income and any taxes owed. Tax returns must be filed by the due date, usually the end of June each year. You can file your tax returns online through the FBR’s e-portal or at a tax office.
Step 5: Pay Taxes Owed
Finally, you must pay any taxes owed by the due date to avoid penalties and interest charges. You can make tax payments through various channels, including online banking, mobile banking, and at authorized banks in Pakistan.
How to Get a Taxpayer Certificate in Pakistan
- Registration for Taxpayers: Ensure that you are registered as a taxpayer with the Federal Board of Revenue (FBR) in Pakistan. If you are not already registered, you can do so by visiting the FBR website or the nearest Regional Tax Office (RTO).
- Online Access to FBR Portal:
- Access the FBR online portal (https://iris.fbr.gov.pk/).
- Log in with your credentials. If you are a new user, register on the portal.
- Navigate to the Taxpayer Certificate Section:
- Once logged in, navigate to the section related to taxpayer services or certificates.
- Select the Type of Certificate:
- Choose the type of certificate you need. In this case, it would be a taxpayer certificate.
- Provide Necessary Information:
- Fill in the required information accurately. This may include your taxpayer identification details, personal information, and any other details needed for the certificate.
- Submit Application:
- After providing the necessary details, submit your application for the taxpayer certificate.
- Payment of Fees (if applicable):
- Some certificates may involve a nominal fee. If required, make the payment through the online portal.
- Verification Process:
- The FBR may conduct a verification process before issuing the certificate. Ensure that the information provided is accurate and up-to-date.
- Download or Receive Certificate:
- Once the application is processed and verified, you can download the taxpayer certificate from the online portal. Some certificates may also be sent to your registered address.
- Visit Regional Tax Office (if necessary):
- In certain cases, you may need to visit the Regional Tax Office to complete the application process. Check the specific requirements on the FBR portal.
- Follow-up (if needed):
- If there are any delays or issues, follow up with the FBR helpline or visit the nearest tax office for assistance.
Advantages of being a tax filer in Pakistan
There are several advantages of being a tax filer in Pakistan, including:
- Compliance with the law: By becoming a tax filer, you demonstrate your commitment to following and meeting your tax obligations. This can help to avoid penalties, fines, and legal consequences for failing to file taxes.
- Improved creditworthiness: Being a tax filer in Pakistan can improve your creditworthiness, making it easier for you to obtain loans, mortgages, and other financial products.
- Access to government benefits: Tax filers in Pakistan may be eligible for certain government benefits, such as subsidies and tax credits.
- Increased credibility: Being a tax filer can increase your credibility with business partners, customers, and other stakeholders, demonstrating that you are a responsible and trustworthy individual or entity.
- Better record-keeping: Filing taxes requires keeping accurate records of your income and expenses, which can help you to manage your finances better and make informed decisions.
- Ease of doing business: For businesses, being a tax filer can simplify the process of opening bank accounts, applying for licenses, and conducting other business-related activities.
- Improved investment opportunities: By becoming a tax filer, you can access new investment opportunities and grow your wealth.
Consequences of Nonfilers
The consequences of not being a tax filer can be significant in Pakistan. Some of the potential consequences include the following:
- Legal consequences: Non-filers in Pakistan can face legal consequences, including fines, penalties, and even imprisonment for tax evasion.
- Difficulty in obtaining loans: Non-filers may need help with obtaining loans, mortgages, and other financial products, as they are seen as high-risk by financial institutions.
- Loss of credibility: Not being a tax filer can harm your credibility with business partners, customers, and other stakeholders, as it may be seen as a sign of irresponsibility or trustworthiness.
- Ineligibility for government benefits: Tax filers in Pakistan may be eligible for certain government benefits, such as subsidies and tax credits, which non-filers may need help accessing.
- Limited business opportunities: For businesses, not being a tax filer can limit your growth opportunities, as it can make it challenging to open bank accounts, apply for licenses, and conduct other business-related activities.Financial penalties: Non-filers in Pakistan can face financial penalties, including fines, interest charges, and additional taxes, for failing to file taxes and pay any taxes owed.
Not being a tax filer in Pakistan can have significant consequences, including legal penalties, difficulty obtaining loans, and loss of credibility. It is essential to take the necessary steps to become a tax filer and meet your tax obligations to avoid these consequences.
Conclusion
In summary, being a tax filer in Pakistan offers several benefits, including improved credibility, access to government benefits, and better record-keeping, among others.
Becoming a tax filer in Pakistan is a straightforward process that requires registering with the FBR, obtaining an NTN, filing tax returns, and paying any taxes owed. You can use the FBR Tax Asaan app to file tax returns too. By following these steps, you can ensure that you meet your tax obligations and stay compliant with the law
