Karachi Tax Bar Association (KTBA) has expressed concern over the problems being faced by taxpayers in filing of withholding tax statements. In a letter sent to FBR Chairman Tariq Bajwa, the Karachi Tax Bar Association (KTBA) said taxpayers were unable to file withholding tax statements for the months of July and August 2015, within prescribed time i.e. October 8, 2015.
It said that in previous system of e-portal, taxpayers were allowed to file separate statements of salary and other than salary however, IRIS did not have such feature. The letter said the rationale behind the separate filing requirement was to ensure that the salary data of employee was kept confidential and therefore was filed directly by Human Resource department and data other than salary was filed by the Finance department.
The filing requirement of single statement secrecy of data of employees of the company within an organisation is at risk. In earlier system, there was a possibility that taxpayer can be assigned different levels of rights by creating a Login ID within an organisation. For this purpose a Master ID was created for an organisation to allow Childs ID's to such users with restricted permission to prepare, verify and or submit data. In this case it was not possible to prepare and submit such statement unless the powers were granted by Master ID Administrator. The above-mentioned system is missing in IRIS and now access is only allowable through Master ID and Password.
Therefore, non-availability of said feature in IRIS is creating problems for large organisations in delegating and segregation of duties. In IRIS system, every employee must have NTN in order to file details of tax withheld from such person. The above requirement restricted the employer to report the below taxable salaries where no tax deduction is required to be made.
It is suggested that instead of NTN, CNIC's should be accepted as valid identity for filing data of employees. The said principal of CNIC's should also available to non-salaried persons which is also restricted in current IRIS system. In earlier system, while uploading the data by withholding agent, it specifically highlighted the discrepancy and clearly summarised the entries and highlighted the relevant columns where there discrepancy has been detected.
In IRIS system, the above feature is not available which consumes time and efforts for a large organisation to detect the relevant column in order to rectify any omission or wrong entry. The IRIS system is not accepting multiple sheets therefore organisation having multiple branches will not be able to file multiple sheets for reporting purposes.
In various cases it has been observed that the system calculates tax for filers and non-filers incorrectly by categorising the person according by the status of the taxpayer. It is suggested that the said option should be left open for the withholding agent.
The system also requires the withholding agent to point out that whether the tax deducted by him is a final tax or adjustable tax. The Karachi Tax Bar Association (KTBA) further said IRIS system since its implementation creating problems in attaching excel file which contained the data of tax withheld by withholding agent. The withholding agent is now requires to feed every individual entry into the system which again requires sufficient time for filing the withholding tax statement. The revision option, which was available in earlier system, is missing in IRIS The current system applying irrelevant sections in withholding tax statement without considering the relevant section under which the withholding agent deducted tax in consideration of nature of payment. It is suggested that the said option should be left open to withholding agent that was previously available, the letter said. Therefore, Karachi Tax Bar Association (KTBA) has requested the chairman to allow a month relaxation for filing of monthly statements to facilitate the taxpayers.
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