Filing Income Tax Returns: Late Filing is Better than Non-Filing and Notices from FBR.

Income Tax Returns Filing (ITRF) is a process in which you have to disclose your income and wealth statement to the FBR. The FBR every year gives 90 days to you for filing tax returns. And the deadline gets set for every 30th September for submission of tax returns.

The FBR asks you about your income source, and there they mention the taxes’ margin to be paid on it during the year. Your income can belong to various sources of income, including income from salary, profits, and gains from business and other professions.   

Late filing; what if I failed to file the tax returns on time and their consequences?

Suppose you fail to file the tax returns within the due date. In that case, the FBR, on some occasions, has to extend the tax returns filing deadline if the number of the tax filers is in large quantity, if people fail to file the tax returns due to some technicalities or if the portal and database of the FBR gets downed. 

Suppose you did not file your tax returns within the deadline issued by FBR. So, in this condition, you need to file your extension; it can be done in two ways, either manually on RTO or online on IRIS. From both of the conditions, whether following anyone, you may get the extension.

If you file the tax returns on the extended date, it would be perfect for you. But if somehow you failed to file the tax returns even in the extended deadline, then when the ATL will be updated on 1st March of the following year so your name won’t be included in that list. So, you would be excluded from the ATL. So, you have to pay a surcharge of Rs. 1000/- to get your name added in the ATL along with the submission of your tax returns on a timely basis. 

When I have an opportunity, Late filing will always be better than non-filing.

So always keep in your mind that “Late compliance is always better than non-compliance”. According to the last income tax ordinance, “the minimum penalty for late filing the tax returns is Rs. 1000/- per day”. So with every passing day, Rs. 1000/- on each day from your pocket will be charged if you don’t comply with filing the tax returns timely.

Following the above case, if you are a salaried individual, so on non-filing and late filing related to the income tax, the minimum penalty is Rs. 10,000/-. If you fail to furnish the wealth statement so the minimum penalty would be Rs. 100,000/-. A total sum up the amount of Rs. 110,000/- will be charged to you if you delay your tax returns filing process.

If you still haven’t filed your tax returns till now, there is nothing to worry about. Indeed, it is a late compliance, but it is way a lot better than non-compliance. We are here; if you are already a user of Befiler, then spare no time, sign in to our mobile app and provide us with your legal data so that your tax filing process would be completed as soon as possible.

But if you are not already a user of Befiler, then the procedure is effortless to follow up. Just sign up, then sign in and provide us with your basic information. Then, you can file your tax returns from us in just Rs. 2500/- in a time period of 2-3 days. So come and file your tax returns with Befiler because, with Befiler, tax is easy.

Issuance of notices by FBR on not filing the tax returns. What options are for me?

Suppose you failed to file the tax returns within the due date and extended deadline. Then the FBR issues the notices to people citing the relevant income tax ordinance sections. The bureau says, “why not impose the penalty on you, because you didn’t file your tax returns in the given due date and extension deadline so now from the relevant clauses of our laws which implies on you, why not we apply it on you?”.

Section 182 subsection one mentions “in which not filing the income tax timely for a non-salaried individual the minimum penalty is Rs. 40,000/-“. Or if you are a salaried individual, then the minimum penalty on you would be Rs. 5000/-.

In case of non-compliance and not settling the matters of the section 182 subsection one, then the notice of section 182 subsection two would be issued right after it, “which includes the order has to be passed, and the action has to be taken”.

Another section includes 114 subsection 4 “you have missed the tax deadline; you were required to file the tax returns, and you haven’t done it”.

Particulars of that person required to file the income tax returns:

• Owns a motor vehicle having engine capacity above 1000 CC

• Owns a property exceeding 500 sq yards

•  Salary above the taxable limit of Rs. 600,000

• Other income above Rs. 400,000

Section 114 Subsection 4 applies the requirements mentioned above to such people who must file their tax returns. The commissioner, concerned officer of the FBR, has the power to issue notice for filing a tax return.

Another law, Section 114 Subsection 5, “time limitations for issuance of notice”. The commissioner can issue you the tax returns notice of the previous five years and order you to submit the tax returns of any one year and above from the last five years.

But if you never submit any current and previous tax returns, the commissioner can issue you the notice of presenting the last ten years tax file returns or any one year and above from the last ten years.     

There is no need to scratch your head on the notices issued to you by the FBR. Obviously, it is a law, FBR has the power to exercise it. But it has a legal defence with it. You can claim a lot of genuine excuses like there are technical issues in the tax system, you failed to obtain your bank reconciliation statement, or you could not consult with your tax advisor etc. These all the excuses are genuine.

And there is another legal defence, that is before the imposition of FBR penalty on you, you have to establish yourself before FBR with a statement like “Your default was wilful, you intentionally delayed the procedure, and you intentionally didn’t file the tax returns. It is challenging to establish a case like this but could result in bearing the fruit in the end”. You don’t need to be scared by the notices; answer them by quickly and swiftly filing the tax returns and right away ensure your compliance.