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Income Tax Return Filing Lawyers

Our Income Tax Return Filing Lawyers in Karachi and Islamabad are the best in the business. Efile FBR Income Tax Annual Returns in time to avoid becoming an income tax non-filer and get the benefits that come with being an income tax filer. 

The deadline for filing an income tax return is 30th September of the following year (for example, the deadline for TY 2021 was 30th June 2021). In the event that you fail to file a tax return by its due date, you will be charged a penalty of a half percent of the tax due per month until the filing is completed, but not more than Rs. 20,000.

In addition to filing your income tax returns manually, you can also file them electronically through the FBR’s website. Individuals’ instructions and requirements differ depending on various factors, such as whether they have been notified by FBR, whether they have been audited previously, etc.

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NTN - Income Tax Registration

Under the Income Tax Ordinance, 2001, every registered person and business in Pakistan receives a National Tax Number (NTN). Tax tracking numbers are used by the Federal Board of Revenue (FBR).

Anyone earning more than Rs. 400,000 per year must register with FBR and get their NTN. Companies with an annual turnover of over Rs. 3 million must also register with FBR and obtain NTNs.

Who has to pay income tax?

In accordance with the Income Tax Ordinance 2001, every person with legal income must pay taxes every year according to the government’s declared rates.

Non-filers: Who are they?

The purpose of income tax is to collect taxes from individuals or organizations based on their earnings. Salaries, interest, rent, dividends, and interest are all sources of income tax. Pakistan’s government collects direct taxes through this method. An individual who has not filed his or her income tax return for the previous year is considered a non-filer. Penalties or imprisonment may be imposed on these individuals since they committed an unlawful act.

Non-filers are subject to a penalty

A non-filer is subject to penalties based on section 41 of Pakistan Income Tax Rules 1999 or on section 99A(1)(b)(i) of Income Tax Ordinance 2001, depending on the circumstances. Non-filers will suffer direct consequences because if income tax is not paid, there is a good chance that someone else will also get into trouble due to some other reason, such as an insufficient source of funds. The only way to avoid this kind of trouble is to pay your taxes.

The Tax Year - What is it?

An individual’s tax year runs from July 1st to June 30th and shall be marked by the calendar year.

In Pakistan, What is Taxable Income?

Taxable Income is determined by subtracting Total Income from donations and certain allowances that qualify for deductions. Businesses, however, may have different taxable incomes. Profits earned by an organization are subject to taxation.

In Pakistan, What are the main Income Heads?

Under the Tax Ordinance 2001, income is classified into five types: income from property, income from a business, income from other sources, and capital gains.

By Based on the Government of Pakistan’s 2021-2022 Federal Budget, the following tax rates and tax slabs will apply to salaried and non-salaried individuals:

FOR SALARIED PERSONS, TAX SLABS

An individual who earns more than 75% of their taxable income under the ‘Salary’ head will be subject to the following tax rates:

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The tax rate on taxable income is

  1. The income tax rate is 0% if the taxable income is below Rs. 600,000.
  1. A taxable income exceeding Rs. 600,000 but below Rs. 1,200,000 is taxed at 5%.
  1. A taxable income above Rs. 1,200,000 but less than Rs. 1,800,000 is taxed at a rate of Rs. 30,000 plus 10%.
  1. Taxable income over Rs. 1,800,000 but below Rs. 2,500,000 – Income tax rate = Rs. 90,000 plus 15% over Rs. 1,800,000.
  1. The income tax rate is Rs. 195,000 plus 17.5% on the amount above Rs. 2,500,000 if the taxable income exceeds Rs. 2,500,000 but below Rs. 3,500,000.
  1. The income tax rate on income exceeding Rs. 3,500,000 but below Rs. 5,000,000 is Rs. 370,000 plus 20% over Rs. 3,500,000.
  1. Income tax rate= is Rs. 670,000 plus 22.5% on the amount above Rs. 5,000,000 if taxable income exceeds Rs. 5,000,000 but less than Rs. 8,000,000.
  1. The tax rate is Rs. 1,345,000 plus 25% on the amount above Rs. 8,000,000 if the taxable income exceeds Rs. 8,000,000 but below Rs. 12,000,000.
  1. Income tax rate = Rs. 2,345,000 plus 27.5% on the amount above to Rs. 12,000,000 if taxable income exceeds Rs. 12,000,000 but below Rs. 30,000,000.
  1. In the case of taxable income exceeding Rs. 30,000,000 but is below Rs. 50,000,000, the income tax rate is Rs. 7,295,000 plus 30% on the amount above Rs. 30,000,000.
  1. The income tax rate is Rs. 13,295,000 plus 32.5% on the amount above Rs. 50,000,000 if the taxable income exceeds Rs. 50,000,000 below Rs. 75,000,000.
  1. The income tax rate is Rs. 21,420,000 plus 35% on the amount above Rs. 75,000,000 if the taxable income exceeds Rs. 75,000,000.
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NON-SALARIED TAX SLABS

In the event an individual’s income under the ‘Salary’ head exceeds 75% of their taxable income, the following tax rates will apply:

The tax rate on taxable income is:

  1. The income tax rate is 0% if the taxable income is below Rs. 400,000.
  2. In the case of taxable income exceeding Rs. 400,000 but below Rs. 600,000, the income tax rate is 5%.
  3. If the taxable income exceeds Rs. 600,000 but falls below Rs. 1,200,000, the income tax rate is Rs. 10,000 plus 10% on the amount above Rs. 600,000.
  4. Taxable income above Rs. 1,200,000 but is under Rs. 2,400,000 – Income tax rate = Rs. 71,000 plus 15% above Rs. 1,200,000.
  5. If the taxable income exceeds Rs. 2,400,000 but is less than Rs. 3,000,000, the income tax rate is Rs. 250,000 plus 20% on the amount above Rs. 2,400,000.
  6. If taxable income exceeds Rs. 3,000,000 but is less than Rs. 4,000,000, the income tax rate is Rs. 370,000 plus 25% on the amount above Rs. 3,000,000.
  7. Taxable income above Rs. 4,000,000 but below Rs. 6,000,000 – Income tax rate = Rs. 620,000 plus 30% on the amount above Rs. 4,000,000.
  8. The income is taxable when it exceeds Rs. 6,000,000, the income tax rate is Rs. 1,220,000 plus 35%.

DO YOU WANT TO FILE YOUR INCOME TAX RETURN?

In order to comply with government regulations, it is crucial that you are completely familiar with Pakistan’s taxation system. Taxocrate is a team of tax advisers in Karachi and tax lawyers in Islamabad. Besides tax consultancy, we also assist you with tax deductions and insurance conditions in your favor. Your energy and time will be better spent on the core business conditions. Tax lawyers in Karachi and tax advisers in Islamabad work in the following areas of tax consulting:

Individualities.

A salaried employee.

The associations.

– The companies.

NGOs (Non-Profit Organizations).

During our process, we analyze your accounts books, make your Income Statement, make necessary amendments (if needed), and finish the Income Statement. We demonstrate the Return of Income after the process has been completed and the customer has approved it.

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SERVICE OF TAXOCRATE

For your compliance with tax regulations, we provide you the following high-quality tax consultancy services:

Tax filing strategy development and planning.

Documentation of your tax returns.

To correspond with the FBR regarding taxes, you must enroll for a National Tax Number.

Working with the Financial Bureau of Revenue (FBR) to obtain interpretations, documentation, and approvals.

  • Preparation of wealth statements.
  • Creating and paying electronic challans.

Preparation and filing of other tax statements (if needed).

Conduct tax audits and provide guidance in FBR audits.

Providing guidance and advisory services to clients on a day-to-day basis.

Managing appeals and objections.

Tax deduction guidance.

Clients receive income-tax refunds from the tax authorities.

Manage tax exemptions for educational institutions and non-profit organizations.