The Federal Board of Revenue has issued revised annual statement of deduction of income tax from salary to be submitted by the employer, seeking more information about the salaried taxpayers. The board on Friday amended Income Tax Rules to judge taxability of salaried taxpayers by collecting more data from them.
The FBR has also issued a new "Tax Card Rate" for Tax Year-2008 for accurate deduction of taxes by the withholding agents in view of changes made in budget (2008-2009). The "Tax Card Rate" would help the withholding agents to apply proper rate of tax for withholding purposes.
Under SRO.997(I)/2008, annual statement of deduction of income tax from salary being submitted by the employer as specified under Part IX, of the Second Schedule to the income Tax Rules, 2002 has been substituted.
As per new format more information regarding the employee is sought for record of the tax department in view of the fact that wherever employer's annual statement is filed, employees having no other source of income are not required to file their return of income. The new format also caters to the change in the law regarding taxability of salary income for the facility of the employers.
The declaration by salaried persons included information about the bank accounts; mobile phone bills; motor vehicle tax; cash withdrawal from banks; profit on savings; electricity and telephone connection numbers and other information. Through another SRO.998(1)/2008 issued by the FBR, monthly statement of deduction of income tax at source to be filed by the withholding agents in accordance with provisions of section 165(2) as specified in Part X of the Second Schedule to the Income Tax Rules, 2002 has been substituted.
As per new format specified information regarding the nature of payments and taxability of the translations is sought in accordance with change in law and for better monitoring/analysis of taxes withheld. The changes in the Income Tax Rules have been made with a view to facilitating the taxpayers regarding verification/credit of tax withheld.