1. Home /
  2. Blog
  3. /
  4. Withholding Taxes In Pakistan Why It Is Important To Educate Yourself And How Can You Get A Refund On Your Paid Withholding Tax Money

Withholding Taxes in Pakistan: Why it is Important to Educate Yourself, and how can You get a refund on your paid Withholding Tax Money?

author Befiler date
Withholding Taxes in Pakistan: Why it is Important to Educate Yourself, and how can You get a refund on your paid Withholding Tax Money?

The word Withholding means “refusal to give something that is due or desired”. So, in this context of Tax, it becomes Withholding Tax which means “to intentionally deduct the tax which can be claimed and/or refunded later”. 

,For tax purposes “Withholding tax is deduction or collection of tax at source, which has generally been in the nature of an advance tax. It is an effective mechanism and important/timely source of revenue of FBR.”

The contribution of withholding tax is about 41% of total direct tax revenues collected throughout the entire country. 

Knowingly or unknowingly, everybody is paying Withholding taxes. Withholding Tax is deducted on multiple sources of your income/expenditure (cash flow) for example: Salary, Dividend, Interest, Vehicle (buy, sell, register, and transfer of ownership), Property (buy and sell), Phone Bill (Prepaid, Postpaid, and Landline), and other sources in the list.        

It is very important to understand the concept of Withholding Tax and believe me if you do understand, you will definitely save tens of thousands of rupees every year.

For you it can be more than hundred thousand rupees depending on your salary and spending you have made during the year.

How can I claim back my paid withholding tax amount?

Withholding tax, which is also sometimes referred to as Advance Income Tax or just Income Tax in bills and receipts, can be refunded back from the government at the end of year. So, the fact is that the government keeps collecting withholding tax from you in different bills and receipts you pay and via many other methods, then you can get it back at the end of year only if you fulfill certain conditions. Which includes paying annual tax or being in an income slot where income tax doesn’t apply to you. Along with the second condition which is to be a tax filer or in other words, timely filing your tax returns every year.

There is a very confusing and logical question at the same time that may be aroused in your mind, which is that “why does the government deduct  withholding taxes when at the end of the year the government has to return it?”. So, the answer to this question is very clear like ‘crystal’ which is that “the objective is to force the majority of the population to  file their income tax returns, and declare any tax paid or unpaid by them. In this case excess tax paid is refunded back by filing an online refund application in FBR portal and on acceptance by FBR that the refund amount is legitimate then the same is transferred to one’s account  in the form of bank transfer or cheque issued.” 

In the second case other than this, “those people who earn taxable income and the same is  disclosed in their income tax return  and also declare their paid withholding tax amount throughout the tax year, then the excess withholding tax amount could be adjusted into their annual income tax returns.”

How can I collect information to get a refund on my paid withholding tax amount?

You know that the tax year starts from the month of July and ends in the  month of June of the following year. So, you have to keep your eyes on the receipts and bills of any expenditure spent by you throughout the whole year. Lookout on the mention of withholding tax, or advance income tax and keep receipts and bills in your possession, then after that you could have evidence of the withholding tax paid by you during the whole year. You can produce it before the FBR to verify your paid withholding tax and later on clinch the tax refund.

Procedure through which I can get my withholding tax refund:

You need to fill a form by visiting the FBR’s IRIS Portal, where you will  file your application for refund along with evidences of deduction of withholding tax  So, after proper verification and submission of further requisite documents / information by you. .

It doesn’t matter whether you’re salaried or any other sources of income  intentionally if you’re not availing this money refund opportunity then consider yourself at the stake of affordable loss.      

Categories
Loading...
Suggested Blog Posts
Loading...

Befiler

how to become tax filer in pakistan

online ntn registration in pakistan

Income Tax Return

File Taxes

E-filling & NTN Registration

The easiest & quickest way to become a filer online. Register NTN, file income tax, check your FBR tax return. Filing taxes in Pakistan has never been easier before.

Tax Questions & Tools

Salary Calculator

NTN Finder

FAQ

Blog

Contact Us

Tax Services

Befiler Tax Filing NTN Finder Salary Calculator income tax return tax refund tax preparation sales tax return filing e file income tax calculate tax return filing online file a tax return free tax online tax

accounts, amnesty, befiler, blog, business, calculator, capital, earning, excise, expense, fbr, filer, financial, house, income, invest, law, ntn, online, organization, pakistan, portal, property, returns, salary, sales, scheme, service, tax, withholding, AOP, Business registration, Online Preparing Tax Filing, NTN registration, NTN Verification, Salary tax calculator, FBR tax filing, Tax return, E-filing

logo dashboard image how to make ntn in pakistan how do i check my fbr return online benefit of filer pakistan how to open my fbr account without password atl status fbr fbr tax return last date pakistan income tax calculator last date for income tax returns pakistan salary tax pakistan taxation fbr tax rates pakistan sales tax rate ntn certificate fbr Befiler – Your Smart Tax Assistant for Income Tax Return Filing NTN Registration with Befiler is Fast and Easy! Why You Should Become A Filer Information Needed to File an Income Tax Return More Incentives, More Reasons to Become Filer Online Tax Filing Culture in Pakistan : A Trend on the Rise Befiler’s Role in Improving Tax Awareness and Education in Pakistan How Do I Become a Tax Filer in Pakistan? Federal Budget for Financial Year 2019 – 2020 TAX AMNESTY SCHEME 2019 TAX FILING FOR SALARIED INDIVIDUALS Important facts to know about NTN Registration Making Tax Simple for People Befiler Makes You a Tax Filer with Ease Pakistan’s Tax Culture Strategy for FBR Transformation and Enhancement of Tax Collections How I should Benefit from Becoming a Filer in Pakistan? Filing Income Tax Returns: Late Filing is Better than Non-Filing and Notices from FBR. File your Tax Returns Online with Befiler Calculation of Taxes on your Salary Tax Credit and Deductible Allowances: How can you Pay Less in Taxes and Save More? Exemptions and Tax Concession: How to Legitimately Remain Safe by Paying in Less or No Taxes Online Correspondence of Tax Notice: Real-time coordination with the Tax body: Nadra and FBR Joining Hands Together To Track And Hunt Non-Filers Sales Tax: Its Fundamental Concepts, Those Who Are Required to Register for Sales Tax, and Basics of Sales Tax Registration. Why you should integrate your POS System with FBR? Implications of Finance (Supplementary) Bill 2021; Get to know which commodities are going to get costlier! Single Sales Tax Returns: A New Sales Tax Returns Portal Finance Supplementary Act 2022 Business NTN Registration Process: How I can Register my Business NTN in Pakistan conveniently? Company Incorporation Process: How I can Register my Company in Pakistan with Ease? It’s the time to profile non-filers: FBR’s bid to launch “Asaan Tax Portal”. Offences, Penalties, and Prosecutions: You can land in hot water, if you failed to comply with filing tax returns. Withholding Taxes in Pakistan: Why it is Important to Educate Yourself, and how can You get a refund on your paid Withholding Tax Money? Calling out Freelancers: Government registering them for controlling Money Laundering Prime Minister’s relief package, a sigh of hope for the nation PM Imran Khan to distribute Rs. 407Bn Interest-Free Loan under Kamyab Pakistan Program Tax Amnesty Scheme 2022 Intellectual Property: Interesting and Relevant Things to Know About Topic: Companies: Its types, basics, purpose and registration benefits. Reviving Sicked Industrial Sectors through granting Tax Incentives FBR’s measures to facilitate people https://www.befiler.com/blog/?category=22&per_page=10 https://www.befiler.com/blog/?category=7&per_page=10 https://www.befiler.com/blog/?category=21&per_page=10 https://www.befiler.com/blog/?category=18&per_page=10 https://www.befiler.com/blog/?category=20&per_page=10 https://www.befiler.com/blog/?category=17&per_page=10 https://www.befiler.com/blog/?category=1&per_page=10