Income tax returns filing hits snags

Shahnawaz AkhterWeb Editor

14th Jul, 2021. 05:33 pm

KARACHI: The taxpayers are running pillar to post to get withholding tax certificates for filing their income tax returns for the tax year 2021, as half a month of the deadline of three months had already passed.

The filing of the annual income and statement of assets has started from July 1, 2021. This may be the first time in the history of the Federal Board of Revenue (FBR) that the returns filing started right on time.

The last date to file the income tax returns for the tax year 2021 is September 30, 2021. The deadline is meant for salaried persons, business individuals, association of persons (AOPs) and corporate entities having special tax year. Otherwise the last date to file returns for the corporate sector is December 31, 2021.

The taxpayers, mostly salaried persons, have argued that they were unable to file their income tax returns because of the unavailability of the withholding tax certificates, which are to be provided by the employers.

Further, certain other statements of withholding tax deduction such as banking transactions, mobile usage, car purchase, property transactions, etc, are still not available for the taxpayers, which are necessary for filing the tax returns to avail of adjustment or tax refund.

Zeeshan Merchant, president of the Karachi Tax Bar Association (KTBA), said that there were practical problems in the tax returns filing. “[The] certificates of tax withheld are necessary for filing [the] tax returns but those are not available,” he added.

Merchant said that usually salary statements are to be given to the employees by the end of August every year.
“This means those salaried persons who are not able to get their certificates may not file the return,” he added.

The KTBA president said the withholding agents are required to file a statement of tax withheld by the 18th of every month of the previous month. “It means the withholding statements for the month of June 2021 will be filed on July 18, 2021,” he said, adding that the availability of withholding tax statements till July 18 is not possible.

Merchant also said that the withholding agents are also required to file quarterly and annual withholding statements; therefore, reconciliation of the tax deduction will also take time, he added.

The KTBA president; however, appreciated the Federal Board of Revenue (FBR) to start the returns filing from the first day of July. “The FBR should be praised for starting filing of returns on statutory timeline,” he said, adding that the tax authorities should realise the practical problems being faced by the taxpayers.

He suggested that the last date to file income tax returns should be October 31 and required amendments should be made in the statute. “Otherwise the law should be amended to make it mandatory for the withholding agents to issue statements within the timeline so that the taxpayers should file their returns conveniently,” he added.

No official in the FBR was available for comment. However, sources said a few returns have been filed so far.

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