Business individuals, AoPs, salaried class: draft income tax return forms for tax year 2014 unveiled

The Federal Board of Revenue (FBR) has issued on Monday draft income tax return forms for non-corporate business individuals, Association of Persons (AoPs) and salaried class for Tax Year 2014. The FBR has issued separate return forms for individuals (salaried only) Individual (salary, property, capital gain and other sources), AoPs (property, capital gain and other sources) business individuals/AoPs. The FBR has issued a notification pertaining to the return forms for tax year 2014 which is available for suggestions up to July 15, 2014.
The FBR has proposed draft of certain further amendment in the Income Tax Rules, 2002 in exercise of the powers conferred by sub-section (1) of section 237 of the Income Tax Ordinance, 2001. The FBR has published the draft returns for the information of all persons likely to be affected. The draft will be taken into consideration by the FBR after 15 days of its publication in the official Gazette. Any objection or suggestion, which may be received from any person, in respect of the said draft, before the expiry of the aforesaid period, shall be considered by the FBR. In the Income Tax Rules, 2002, in the Second Schedule, after Part-II D, the new return forms have been specified.
The FBR has also introduced wealth statement form for the tax year 2014. The limit of Rs 1 million or more (declared income or assessed for filing of wealth statement) has also been done away with. Everyone even under the final tax regime has also been obliged to file wealth statement irrespective of the tax paid.
Under the draft return form, the individuals deriving income under the head Salary have to file one page IT-1A Form with Annex F and Wealth Statement. The individuals deriving income under the head Salary, Property, Capital Gains and Other Sources (excluding Business) and Income subject to fixed/ final tax have to file two page Return in IT-1B Form with Annex F and Wealth Statement.
The AoPs deriving income under any head other than business have to file two- page IT-1C Form. The individuals deriving income under the head business or falling under Final Tax Regime (FTR) such as Commercial Importers, Exporters, Contractors, etc have to submit IT-2 Form with Annex-A, Annex-B and Annex-F and Wealth Statement. Annex C, Annex-D & Annex-E are required only where Depreciation/Amortisation, Admissible/Inadmissible Deductions and Minimum Tax Chargeable/Option for Normal Tax Regime instead of Final Tax Regime are involved.
All Individuals, including members of AoPs or directors of companies, must file Wealth Statement. The AoPs deriving income under the head business or falling under Final Tax Regime (FTR) such as Commercial Importers, Exporters, Contractors, etc have to submit IT-2 Form with Annex-A and Annex-B. Remaining Annexes (C, D, E) are required only where Depreciation/Amortisation and Admissible/Inadmissible Deductions and Minimum Tax Chargeable/Option for Normal Tax Regime instead of Final Tax regime are involved. According to the FBR, taxpayers may file Return of Total Income/Statement of Final Taxation and Wealth Statement through the following modes:
(a) Electronically at FBR Portal (https://e.fbr.gov.pk) which is mandatory for all AoPs, Sales Tax Registered Persons, Refund Claimants and Salaried Persons having annual income of Rs 500,000 or more. However, all others are also encouraged to file the returns electronically; and
(b) Manually on paper at Taxpayer Facilitation Counter of the respective Regional Tax Office.
The FBR said that the paper Return Form can be downloaded from FBR Website http://www.fbr.gov.pk. in the following two types:
(i) Formulae Version in Excel Format; and
(ii) Plain Version in Excel Format.
Taxpayers may seek guidance through the following modes:
(a) 24-Hrs Help line 051 111-772-772
(b) Office Hours Helpline 0800 00 227, 051 111-227-227
(c) By visiting the nearest Taxpayer Facilitation Centre (TFC). List of TFCs can be downloaded from FBR website at http://www.fbr.gov.pk
Tax can be paid in any authorised branch of NBP and SBP at any time before filing of return. List of authorised braches of NBP and SBP can be downloaded from http://www.fbr.gov.pk, FBR added. The FBR's instructions for filling in Wealth Statement Form revealed that all assets must be valued at cost. If an asset is acquired under a Hire Purchase Agreement, total price should be declared as asset under the appropriate head and balance payable amount should be declared as liability. If an exact figure can not be determined, an estimated figure may be declared. If Wealth Statement is filed for the first time, separate Reconciliation Statement must be filed for each previous year. The Business Capital at Sr. 4 should consist of the net balance of assets minus liabilities as per the Balance Sheet on the specified date, if such net amount is a credit balance. If the net balance is a debit balance, it should be declared as a liability. The agricultural Plant, Machinery, Equipment, Livestock, etc, at Sr. 5, must be detailed with description, for example, Tubewell, Harvestor, Tractor, Cow, Horse, etc.
The assets created in the name of spouse(s), children & other dependants at Sr. 13 are to be declared only if acquired by them with funds provided by you (Benami Assets), the FBR's instructions added.