FBR’s AI system to prioritise to corporate, non-salary returns

ISLAMABAD: The Federal Board of Revenue’s (FBR) new AI system would give priority to corporate returns and non-salary returns in the first phase of audit through the FBR’s Compliance Risk Management (CRM) System.

Sources told Business Recorder that the salary returns with short documents or short payments would be questioned through the CRM system, but the data of non-corporate returns would be examined for audit purposes. High-risk corporate cases would be selected for audit through the AI system.

“We are not going after the salaried class under the new AI system”, they said. The AI system would gradually improve through learning and testing over time, they added.

From September 1, 2026, the FBR has restrained Inland Revenue field formations from selecting cases for income tax assessments unless the cases have been selected and assigned through the FBR’s Compliance Risk Management (CRM) System.

The Directorate-General (Compliance Risk Management) is hereby directed to ensure uninterrupted operability of the CRM System and to provide necessary technical support, training and guidance to the field formations. Any system downtime or technical issue affecting the CRM System shall be reported to the Member (IR-Operations) within 24 hours.

With effect from September 1, 2026, it is hereby directed that no new amendment of assessment proceedings, including but not limited to proceedings under sections 121, 122, 122A and 122C of the Income Tax Ordinance, 2001, shall be initiated or amended by any officer of Inland Revenue unless the case has been selected and assigned through the CRM System. Any proceedings initiated in violation of this Circular shall be deemed unauthorised and may be rendered void ab initio by the competent authority.

Assessment proceedings already initiated and in progress as of August 31, 2026 may be concluded under the existing framework. However, any fresh amendment, reassessment, or new show-cause notice in relation to such cases issued on or after September 1, 2026 shall comply with the CRM-based selection process mandated under this Circular.

Any request for exemption from the CRM-based selection process shall be submitted in writing to the Member (Inland Revenue - Operations) with complete justification. No exemption shall be granted unless specifically approved in writing by the Member (IR Operations) or an officer duly authorised by him.

Copyright Business Recorder, 2026