how to become filer in pakistan

Introduction

In Pakistan, it is important for one and every organization to register him/it as a tax filer, in order to be in the tax net and enjoy several benefits which are provided through tax system. Filer is an individual that is registered with the Federal Board of Revenue (FBR) and is a filer of taxes. Not only that, it is your duty to vote for them, but it also assists in claiming benefits like easy loan approval, higher credit limit, and non-applicable penalties.

In this blog, we will show you how to become a filer in Pakistan, and the chance of being a filer, and how to register.

What is Filer in Pakistan? 

A tax filer therefore refers to an individual or company that submits his or her income tax return to the FBR of Pakistan. Tax submission is mandated and provides the government with standard figures upon which to base their earnings, other outstanding dues and appropriate distribution.

Why Should You Become a Filer? 

There are several benefits of filer in Pakistan:

• Access to Financial Benefits: Those filing taxes have better features when it comes to interest limits on loans from the bank as well as credit cards.
• Avoid Penalties: Penalties such as higher tax rate and interest shall be levied for those that did not file. That is because being a filer authors you from this.
• Government Contracts: Any tax filer has access to government contracts but non-filers are generally limited from such opportunities.
• Eligibility for Tax Relief: Filers may avail different tax exemptions and deductions.

How to become Filer in Pakistan?

Here’s a detailed guide on how to be a filer in Pakistan:

Apply for a Computerized National Identity Card (CNIC)

First to qualify as a filer, the individual must have a CNIC or hold a NTN which is a national tax number. If you are not having CNIC you should apply for CNIC at one of the NADRA centers. The CNIC is important because it will be used as identification number in the registration with the FBR.

Get registered with the Federal Board of Revenue (FBR).

Visit the FBR Website

To get registered as a filer, visit the official FBR website (https://www.fbr.gov.pk/).

Sign up for an Account on FBR’s Iris Portal

If you don’t already have an account, you will need to register on the FBR’s “Iris” site. The registration process is simple and includes, submitting details such as CNIC/Passport, current address, and communication details.

If you are already a member, you should sign in with your credentials on the account.

Complete a registration form

To register for a Taxpayer account, after signing into the Iris portal, click on “Registration for Taxpayer.” Those details include general information, your income and source, employment record, as well as any property that you may own.

Submit Required Documents

As soon as registration, some documents are required including proof of income, bank details or the recent utility bill on your address. This helps to make certain that all the information that you’re entering into your portfolio is real and authentic.

3. Filing the Income Tax Return

You also have to file your income tax return, after you register at the FBR’s Iris portal. Reading through an income tax return may be quite cumbersome; however, FBR has eased the process for the taxpayers.

Prepare Your Documents

Before filing your return, gather all the required documents, such as:

• Salary slips (if employed)
• Bank statements
• Incorporated business income (if any)
• Any other document relating to property if you own any property.

Fill the Income Tax Return

With the help of the portal Iris, enter the income tax return form. The form asks the most important and specific questions of your income, your deductions, and any taxes you have already paid, if any.

File the Return

After you have filled all the boxes and details, simply send the form. Where any tax is due, you will be expected to make the payment through the payment options provided.

4. Obtain your National Tax Number (NTN).

After filing your return, you will be issued with an NTN which is your identification number for tax purposes. This number should be saved save since you shall be utilizing it in all future tax returns.

5. Keep Your Tax Record Updated

Filing also does not stop once you have registered for the first time. To remain a filer in Pakistan, you must:

• File your tax returns on an annual basis.
• Submit anything related to income, property or change in financial position.
• Many a times paying taxes may be delayed due to some reasons, it should be make sure that the taxes are paid before the due date is crossed.

Important Tips for New Filers

• File on Time: Failing to meet the deadline will attract penalties and also you may lose your status as the filer.
• Accurate Documentation: It is important to check all the specifics that you are offering are correct. Any difference in the above may lead to a tax audit.
• Consult a Tax Professional: If you are in doubt on how to go about filing taxes or your taxes are complex, it is highly recommended that you seek the service of a tax adviser.

Common Mistakes to Avoid

• Not Keeping Track of Documents: Bank, receipts, invoices and all other vouchers should be preserved to support the tax returns.
• Not Reporting All Income: One must declare all his or her sources of income so that he or she is not penalized.
• Ignoring Deadlines: There are always penalties for failing to meet the tax filing deadline which results to additional expenses. Most importantly be very careful with due dates.

Conclusion

Legal compliance is good but being a filer in Pakistan is also an intelligent step towards the improvement of the financial sector. To be granted access to these financial initiatives, it can provide ready access to loans, tax deductions, business with systems of government and private companies.

Following these steps, people can easily register with FBR and can start the filing of tax as mentioned above. It is important for you to keep your financial records, records of your accounts as well as submit your returns on time as a measure of demonstrating that you are a law abiding citizen in terms of tax laws.

This procedure can be intricate if you find it hard to go through it on your own, and it is recommendable to consult a tax advisor. When it comes to evaluating your compliance, you’ll be in good hands and on the path to being a more responsible filer in Pakistan.