ISLAMABAD: The Federal Board of Revenue (FBR) has removed a tab from the new income tax return form for Tax Year 2022 under the IRIS, denying the taxpayers to adjust their tax liabilities against past years' refunds.

The issue forced the Federal Tax Ombudsman’s office to conduct an own motion investigation against the FBR as to why the tab has been removed from the return through the IRIS system.

The FTO is surprised how the FBR can remove such a key provision from the IRIS system denying this facility to the taxpayers. The tab has been removed from the new income tax return form for the Tax Year 2022, resulting in the rejection of past adjustment claims of the taxpayers.

Keeping in view the seriousness of the issue, the FTO has taken suo motu of the issue that the FBR system is rejecting claims of refund applications of previous tax years under the new income tax return form.

Now, no taxpayer can adjust his tax liability for the year against refunds for the previous year based on deemed assessment orders, the FTO said.

Income tax returns form: FBR urged to resolve all technical issues

Instead of complying with the tax law provisions, the tax department kept on sleeping over the refund application of taxpayers for more than prescribed period of 60 days.

The taxpayer on the other hand, after having failed to get his refunds issued, resorted to claiming of its adjustment in his return in subsequent years for which a separate tab was provided in return of income through IRIS. This tab has now been removed in income tax return for tax year 2022 in IRIS. Thus, all the actions of disposal of refund application of previous years, determination of refund and adjustment of the same against taxpayer’s admitted liability in terms of provisions of 170(3) and (4) of the Ordinance are pending with the department and whereas, the department is asking the taxpayer to produce the evidence for the same.

Copyright Business Recorder, 2022