Daily Times

KARACHI: Tax professionals have requested the Federal Board of Revenue (FBR) to delete the form about income returns filing by non-resident Pakistani citizen in recently proposed draft return forms saying that it is against the law and is creating confusion.

The Karachi Tax Bar Association (KTBA)’s president Khalid Mahmood said non-resident Pakistani citizens are not required to file return of income unless they earn any income in Pakistan. However, the draft return form SRO from Page 35 to Page 37 contains a new form for non-residents. As per section 114(1) there is no requirement for Non-Resident to file any return if there is no income.

The KTBA made certain observations while reviewing the draft return forms and pointed out that the forms have been made available only for individuals and AOPs but not for companies and therefore companies with Special Tax Year cannot review their return forms for filing.

At the time of filing wealth statement, the IRIS asks for town code which is neither available nor defined in the draft return form SRO. Further, it not out of place to highlight that town system does not exist in Karachi anymore and since last quarter of 2013, Karachi is divided into District Municipal Corporations. Thus, KTBA suggested that system should have comprehensive list of areas facilitating taxpayer to select area relevant in his case.

The tax body said in wealth reconciliation statement under the head “other” appearing in both the “inflows’’ and “outflows” a separate description box should be added. This will facilitate not only the taxpayers but will also be helpful in preventing unnecessary notices by the officer.

Under the salary return form, field for tax deducted Us 149 is not available. This anomaly is found in the IRIS. The Draft return on the IRIS is also not computing tax payable on salary.

Only account number is printed on wealth statement and other information such as bank name, branch name and address is not printed which creates problem for the taxpayer as well as for the department. It is suggested to remove this anomaly, the KTBA added.

In a letter to the Chairperson FBR, Rukhsana Yasmin, President KTBA further suggested that instructions given in the last of the return forms need updation as per law. “The WWF paid in the province of Sindh to the Sindh Revenue Board (SRB) has to be considereda permissible tax expense or a bonafide allowance, thus require inclusion in the form”.

Also, the senior citizen’s rebate is not being calculated on IRIS while on the payment side it has been observed with concern that the codes of Banks and their branches are available at very limited number which compels the tax payer to put the code of the main branch of the Bank. This anomaly can easily be addressed if the data of codes of banks and their branches is asked for from the Pakistan Banks’ Association and made available, it added.

The KTBA suggests that “Page-Wise Import” feature may be enabled so that taxpayer may select only the required data. This will certainly reduce filling of return form considerably.

It is also suggested by tax professional that in the cases where on the basis of return there is tax refundable, system should automatically facilitate generation of refund application under section 170 in prescribed manner.

The KTBA said introduction of various forms also creates problem for the taxpayers and requires intervention of their consultants.