FBR warns of fines up to 75 percent as tax return deadline nears

The deadline for filing income tax returns is October 31, and the Federal Board of Revenue has warned that taxpayers who conceal assets or submit false declarations can be fined up to 75 percent of the tax owed, ARY News reported, citing sources.

The penalties are available to the bureau under Section 182 and its subsections of the Income Tax Ordinance, which give it authority to impose administrative penalties. Outstanding penalties that are not cleared on time carry a further charge of Rs 1,000 a day, according to the same report. The sources said the bureau would act strictly against misleading information in returns.

FBR sources told ARY News that the bureau has collected data on properties and assets held across the country and will check every return against it through an automated system that relies heavily on artificial intelligence. Taxpayers were advised to consult professional consultants and to correct any errors before October 31.

Separately, FBR Chairman Rashid Mahmood Langrial has taken notice of advance income tax notices issued to salaried employees. The chairman's position, as described by the sources, is that advance income tax on people whose only income is a salary is not justified. Those with income from other sources may still owe adjustable advance tax, and any advance tax already collected from salary-only taxpayers will be adjusted immediately.

Salaried taxpayers across the country had been receiving quarterly notices demanding advance income tax. Under the change described by the sources, people whose sole income is a salary will no longer receive them. The measure is intended to reduce the financial burden on salaried employees.

Investify reported that the FBR has received a record 7.5 million returns and that tax bar associations are seeking an extension of the deadline. The report did not say whether the bureau had responded to that request. Concerns have been raised about the tax burden on salaried employees and about a wider spread of the tax load across income groups.