The Federal Board of Revenue (FBR) has proposed allowing individuals who file their income tax returns after the due date or extended deadline to be included in the Active Taxpayers List (ATL) without paying the applicable surcharge, subject to certain conditions.
Under the proposed rules, taxpayers seeking the concession will be required to submit an undertaking through the FBR’s Inland Revenue Information System (IRIS) portal, pledging not to purchase, acquire or otherwise obtain ownership or beneficial interest in any property for six months.
The new rules were introduced on Tuesday through SRO1690 as draft amendments to the Income Tax Rules, 2002. The FBR has invited feedback from stakeholders within one week before the amendments are finalised.
Under the proposed Rule 81B(2B), an individual who files an income tax return for the latest tax year after the due date or extended deadline will qualify for inclusion in the ATL without payment of the surcharge, provided the prescribed undertaking is submitted through the IRIS portal.
The six-month restriction on property acquisition will begin from the date mentioned on the electronic acknowledgement generated by IRIS following the successful submission of the newly prescribed Form ATL-U.
The proposed framework would also empower the FBR to verify compliance with the undertaking. For this purpose, the tax authority may use information available under the Income Tax Ordinance, as well as data obtained from government authorities, agencies, registries, financial institutions or other lawful sources.
If the FBR finds that a taxpayer acquired ownership or a beneficial interest in property during the restricted six-month period, the individual will first be given an electronic opportunity to explain their position.
If the breach is established after the hearing, the taxpayer’s surcharge-free ATL status will be withdrawn from the date of the violation. Any subsequent ATL status will then be determined under the existing provisions applicable to late filers.
The FBR has also proposed a new undertaking, Form ATL-U, for taxpayers seeking to avail themselves of the facility. The form will require details including the individual’s name, CNIC or NTN, tax year, return filing date, IRIS acknowledgement or reference number, and the date on which the undertaking is submitted.
The undertaking will be electronically verified through the IRIS system.
