ISLAMABAD: Prime Minister Shehbaz Sharif will take final decision on Monday (today) on possible one-month extension in filing of income tax returns due to failure of Federal Board of Revenue’s (FBR) system to receive returns containing high volume of data or information.
In this regard, the FBR has received requests from tax bars and associations across the country on Sunday. Faraz Fazal Sheikh President Rawalpindi Islamabad Tax Bar Association told Business Recorder that small returns like salary returns were received by FBR system on Sunday, but returns having heavy data is not uploaded or received during last two days. This requires immediate extension in date to clear pendency of returns to be filed by compliant return filers.
Faraz said that despite our earlier communications with the Federal Board of Revenue (FBR) on this matter, it remains unresolved, making it impossible for taxpayers to file their tax returns within the prescribed timeline of September 30, 2024.
Extension in filing of income tax returns predicted
The current situation of the IRIS software is utterly inadequate and unbearable. The system, which is intended to facilitate taxpayers in filing their returns, is plagued by persistent technical failures, slow response times, and errors in tax calculations. Despite repeated assurances, these issues have not been rectified, so taxpayers are unable to complete their filings accurately & on time, particularly in the matter of minimum tax. And even if the IRIS system would function properly, this would require further 45 days to complete all the tax returns.
He said that over the years, tax returns have become increasingly complicated, requiring significant time and effort to compile and furnish. Many taxpayers are struggling to comply with the requirements due to the complexity of the Laws and return forms. The complications is return forms, also the growing number of taxpayers, necessitates an extension of the filing deadline to allow for a more efficient and accurate submission process.
The electronic return form was issued vide SRO 1321(I)/2024 on 28th August 2024, providing only 32 days for a large number of taxpayers to comply with the filing of tax returns. This limited timeframe & systemic challenges in IRIS, has made it impossible for the taxpayers to meet the 30th Sep deadline, while 90 days are given after 30th June that is the close of a tax year to file a return.
The fundamental rights of taxpayers guaranteed by the Constitution must be respected, including the right to a fair and reasonable opportunity to comply with tax obligations. The current circumstances are placing an undue burden on taxpayers, preventing them from fulfilling their obligations within the prescribed timeframe. Extending the deadline is essential to ensure compliance without undue hardship or the fear of penalties, Faraz maintained.
The prevailing circumstances have made it the collective voice of the nation that the deadline for filing income tax returns must be extended.
In light of these pressing challenges, we earnestly request that the deadline for filing income tax returns for the tax year 2024 be extended by at least 45 days that is up to November 15, 2024. This extension is necessary to allow taxpayers to fulfil their legal obligations accurately and without unnecessary hardship, while also providing FBR with sufficient time to resolve the IRIS issues, Faraz added.
In an urgent communication to the FBR Chairman, Pakistan Tax Bar Association said that compliant taxpayers are facing problems in filling his income tax return due to inefficient and slow working of IRIS system. It is pertinent to mentioned here that as a result of slow working of IRIS compliant Taxpayer’s not only unable to process and file returns.
The bar received constant complains from across the country that the system shutdown after 12 AM till 4 AM on daily basis and is also not properly working / slow working throughout the day.
The system is not accounting for AOP exempt income instead calculating Tax on total income including income of AOP which has already been taxed. Long outstanding issue, which is pending since last two years that the system is calculating difference of minimum tax and normal tax liability and adding the same in the tax liability even in the case where only minimum Tax is payable
There are incorrect computational issues and system not picking up paid challans on IRIS.
The data disappearing after completion of feeding which result in wasting of time by again feeding of data once they restart the system after hanging up the same. In the cases of multiple challan, CPR is not reflected in MIS. The non-Resident last year wealth is still appearing/ non editable. The salary income with one-off service receipt, IRIS is asking to file profit & loss Account, Balance sheet and attachment of Accounts.
Last but not the least, as IRIS is almost shutdown completely from last two days till now, it is imperative to extend the date of filing from September 30,2024 till FBR provide smooth and swift IRIS system to the Taxpayer’s, for filing of Tax return. However, without prejudice to the above, we expect from FBR that it should also provide relief to Taxpayer’s by giving them at least 30 days extension in order to provide reasonable time to file tax return with proper disclosures and peace of mind, PTBA added.
Copyright Business Recorder, 2024