How can salaried individuals become tax filers in Pakistan?

Federal Board of Revenue, Government of Pakistan, has an online system for e-filing of income tax returns known as Iris. The system is user-friendly, intuitive, and pretty straight-forward. You can file the statements by knowing some essential information. This blog post will get you started and complete the tasks without the need of any tax consultant. This post assists salaried individuals only. The process may differ for non-salaried individuals.

First, you need to be sure that you are a salaried individual. Its source document is Income Tax Ordinance, 2001. In the first schedule, part I, division I of this ordinance, rates of tax are mentioned. The clause 1A is as follows:

Where the income of an individual chargeable under the head β€œsalary” exceeds fifty per cent of his taxable income, the rates of tax to be applied shall be as set out in the following table [rates of tax for a salaried taxpayer]

The tax year in Pakistan begins on July 01 and ends on June 30. During the tax year, if your taxable income consists of salary to the extent of more than fifty percent, then you are a salaried individual, and the tax slab of the salaried individuals will apply to you.

Once you have confirmed that you are a salaried individual, the next step is to check whether you are registered in the fbr system or not. You can check it by clicking the link below:
https://e.fbr.gov.pk/esbn/Service.aspx?PID=S9FLaJ75kZNZHZ8+1qL8lA==

The above link will direct you to fbr’s Online Inquiry page. Check your status by selecting CNIC in Parameter Type. Enter CNIC (without dashes) in Registration No., enter the Verification Code and click Verify. If you are a registered person, the system will display Registration No, Name, Category, Tax Office, and other information. If you are not a registered person, the system will display No record exists.

Now that you know your registration status, visit the following link:
https://iris.fbr.gov.pk/public/txplogin.xhtml

In the above link, you will see two options:

  1. Registration for Unregistered Person
  2. E-Enrollment for Registered Person

If you are an unregistered person, you will select option 1 and then option 2. If you are a registered person, you need only apply for e-enrollment for the registered person. After entering some necessary information such as CNIC, Cellphone Number, and Email Address, you will receive your Registration Number and Password. If you selected option 1, you might get registration number and password for Iris in option 1, and in that case, you may not be required to execute option 2. See this pdf from fbr website:
https://e.fbr.gov.pk/SOP/IRIS/Iris-UGD-REGM-Urdu.pdf

Now you have an online account for using Iris system. Use your Registration Number and Password to log into the Iris system. Depending on the details you see, you may have first to fill the form 181 (Form of Registration filed for modification) (Income Tax). At the upper right section, you will see an option of Registration Certificate. Click this option and view the Taxpayer Registration Certificate.

Now, at the end of each tax year, you will need to select the following two options from the Declaration section and fill the relevant details:

a. 114(1) (Return of Income filed voluntarily for complete year)
Watch this video from fbr website:
https://e.fbr.gov.pk/SOP/IRIS/Iris_UGD_ITR_Video.zip

b. 116(2) (Statement of Assets / Liabilities filed voluntarily)
Watch this video from fbr website:
https://e.fbr.gov.pk/SOP/IRIS/Iris_UGD_WLS_Video.zip

If all your taxable income is the salary paid by your employer, you probably need not to pay anything in the bank as tax amount. Your tax is already deducted at source. You only need to e-file the details.

When you are done with e-filing the income tax returns, click the following link:
https://e.fbr.gov.pk/esbn/Service.aspx?PID=ZQA97zliXRZrR4gZIeb+HA==

It will direct you to the Active Taxpayer List (Income Tax) search option. Enter CNIC (without dashes) in Registration No. field, select the current date, enter the verification code, and click Verify. If your name is included in Active Taxpayer List (ATL), your Filing Status will be displayed as Active. You may not see the Active status immediately upon e-filing the income tax returns. ATL is updated periodically by fbr. Once your name is in the list, continue e-filing the income tax returns before the due date to maintain the status of a tax filer.

All the best πŸ™‚

Update 1: September 09, 2019

FBR introduced updated income tax return forms 2019 for individuals, salaried individuals, and association of persons (AOPs) in September 2019. In the updated forms, when you select the option 114(1) (Return of income filed voluntarily for complete year), the following options of Personal Assets / Liabilities / Receipts / Expenses are also displayed:

  • Personal Expenses
  • Personal Assets / Liabilities
  • Reconciliation of Net Assets

In the revised income tax return forms, the forms of section 114(1) have been classified into different categories as follows:

  • 114(1) (Return of Income filed voluntarily for complete year)
  • 114(1) (Return of Income for a person deriving income only from salary and other sources where salary is more than 50% of income)
  • 114(1) (Return of Income filed voluntarily by non-resident Pakistan-origin person having no Pakistan-source income)
  • 114(1) (Return of Income filed voluntarily for incomplete / transitional year)
  • 114(1) (Return of Income for a person deriving income only from salary and other sources where salary is more than 50% of income filed after revision)

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