ISLAMABAD: The Federal Board of Revenue (FBR) has dispatched the draft income tax return forms to the Law and Justice Division for vetting covering taxpayers including traders' community and salaried class for the Tax Year 2020.
Sources told Business Recorder here on Tuesday that the FBR has held a meeting on the simplification of income tax return forms at the FBR House. Major focus of the meeting was to simplify return forms for the salaried class as well as the small traders. It has been decided to timely issue the return form after vetting from the Law and Justice Division.
According to the sources, the meeting reviewed the draft income tax returns and further simplified return form for the salaried individuals. The meeting decided to issue a simplified income tax return form for the traders' community. The small traders would be provided a very simple return form. The small traders are repeatedly requesting the FBR for a simplified form.
In August 2019, the FBR had notified Simplified Scheme for Traders, Small Shopkeepers Scheme, and Business License Scheme. The scheme applies to the retailers and wholesalers having turnover less than Rs. 50 million, self-invested equity below Rs. 50 million, cost of fixed assets not more than Rs. 100 million, and the number of employees below or equal to five.
The Special Procedures for Payment of Taxes by Small Shopkeepers defined small shopkeeper as an individual who operates at the premises with less than 300 square feet covered area. The individual will not qualify as a shopkeeper if he is a jeweler, warehouse, wholesale, or real estate agent, developer, builder, doctor, chartered accountant, lawyer or any other category specified by the board.
In August 2020, the FBR had issued draft income tax return forms for salaried class, business individuals, Association of Persons (AOPs) and companies for comments.
The FBR had issued SRO 745(I)/2020 to issue draft income tax return forms seeking feedback of the stakeholders.
The FBR has issued electronic return forms for salaried persons; AOPs, business individuals and companies.
In the draft return form, the information of companies specified in the annual audited accounts statements and that specified in the income tax return form are different like bifurcation of import purchases and domestic purchases. This would create serious reporting problems for the corporate entities and undertakings.
Copyright Business Recorder, 2020