Annual Income Tax Returns

Introduction:

Annual Income Tax Returns are documents filed with the tax authority to report income, deductions, and taxes owed or refunded for a specific tax year. While, Wealth Statement is a declaration of assets, liabilities, and net worth as of a certain date, submitted and reconciled with income tax returns to provide a position of financial status.

Who Need to Furnish a Tax Return?

As per Income Tax Ordinance, 2001. The following persons are required to furnish a return of income for a tax year:

• Every Company (Registered under the Company Act, 2017 or equivalent)
• Every Partnership Firm (AOP).
• Every Person whose income exceed the prescribed limit (Such as for Salary Annual Rs. 600,000 and for Business Annual Income Rs.400,000).
• Every NPO as per 2(36) of ITO, 2001.
• Every NTN holder.
• Every Person:
• Charged to Tax in any preceding two years.
• Claim a loss carry forward.
• Holder of commercial or industrial electricity connection where annual bill amount exceeds Rs. 500,000/-
• A resident person registered with any:
Trade Body / Trade Association, Bar Councils, Medical & Dental Councils, Member of ICAP & ICMA.
• Owns motor vehicle having engine capacity above 1000 CC.
• Owns immovable property with a land area of
• 500 square yards or more or any flat located in area of Municipal, Cantonment or Islamabad (ICT)
• 500 square yards or more or any flat having covered area 2000 square feet or more located in a rating area.

Advantages of Filer and Disadvantages of Non-Filer:

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Filer persons usually pay single rate of taxes while on other hand Non-Filer persons pay double rate of tax or even more. Following are the few rates of tax on various transactions for the tax year 2023-24 which compare the difference of rates:

FILER vs NON FILER (2023-24)

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Description Filer Non Filer
Cash Withdrawal / Banking Transaction 0% 0.6%
Inti. Transaction through Debit/Credit Card 2% 10%
Purchase of Property 2% 7%
Sale of Property 2% 4%
Tax on Saving Account Profit 15% 30%
Tax on Specifies Services 3% 6%
Tax on Services 7% 14%
Rent Income 5 to 15% 10 to 15%
Prize Bonds 15% 30%
Motor Vehicle Leasing 0% 12%
Purchase of Vehicles Rs. 10,000 to 500,000 Rs. 30,000 to
Registration of New Vehicle Rs. 10,000 to 500,000 Rs. 30,000 to 1,500,000
Vehicle Annual Token Tax Rs. 800 to 10,000 Rs. 1600 to 20,000
Tax on Commission 12% 24%
Monthly Domestic Electricity Bill > Rs. 25,000 0% 7.5%
Sale to Retailers by Manufacture, Distributors,Dealers,
Wholesalers & Commercial Importers
0.5% 1%
Property Auction 5% 10%
Issuance of Bonus Share 10% 20%

Requirements For The Filing Of Annual Income Tax Returns:

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• Salary certificate (for salaried person only).
• Profit & loss and Balance sheet (for business individuals and companies).
• Withholding income tax deduction certificates.
• Bank statements of all Bank Accounts from July to June each Year.
• Any other income during the Year.
• Detail of Expenses
• Property (Agricultural, Residential and Commercial purchased /sold during the year).
• Investment in Assets
• Loan & Advances
• Motor Vehicle (purchased/sold during the year)
• Jewellery (purchased/sold during the year)
• Furniture & fittings (purchased/sold during the year)
• Accumulated life insurance paid in the year.
• Accumulated provident fund (certificate of contribution)
• Assets in the name of wife/minor children
Other all kind of assets on your name.

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How can Pakistan Business Consultants help you?

Pakistan Business Consultants brings years of experience and expertise in facilitating Filing of Annual Tax Returns for numerous companies and individuals. With a deep understanding of the complexities involved, we are equipped to navigate the details of the process efficiently. Our extensive knowledge allows us to make informed decisions that optimize the filing process for our clients.

Trust Pakistan Business Consultants for comprehensive assistance throughout the compliance.

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