The level of non-compliance within real estate sector is evident from the fact that a top company engaged in marketing of a mega real estate project in Islamabad is a persistent non-filer of income tax return. Sources told Business Recorder here on Tuesday that the FBR database has disclosed astonishing facts about a company engaged in major real estate projects in Islamabad.
A marketing agency of a real estate project of Islamabad has obtained the National Tax Number (NTN), but never filed income tax returns. The company falling within the jurisdiction of Regional Tax Office (RTO) Islamabad has been engaged in marketing, booking plan and advertising. The RTO Islamabad has completely neglected this marketing company in the real estate sector for taking any action to enforce filing of income tax returns.
The FBR database revealed that the marketing company is one of the biggest real estate marketing companies with a network of offices abroad. In the presence of such a wide network, the company is a non-filer of the income tax returns. It is pertinent to mention that effective Tax Year 2010, the tax deducted on services has been placed outside the ambit of the final tax regime and now constitute minimum tax liability of the service providers. In view of this fact, returns for all the tax years not hit by time limitation needs to be enforced immediately in the case of this marketing company. But more important than this, information available with the company needs to be utilized for bringing all those into tax net who have made investments in the various housing projects undertaken by this marketing company. Another aspect of the case is that the marketing company has hired the services of another company which found to be a chronic non-filer of income tax return.
Similarly, FBR database further revealed that housing project whose marketing has been done by the said company is also non-filer of return. The data further revealed that the tax status of a Cooperative Housing Society of Islamabad needs to be determined. In case of exemption, withholding statements may be enforced and withholding audit may be conducted of earlier as well present projects, because there is no time limitation on an action under section 161/205 of the Income Tax Ordinance 2001 as the society has already completed its project. Further the society deals with top developers, town planners and marketing agents for the execution of the project, hence, the withholding audit is expected to unearth a trail of tax default, sources added.