Filing income tax returns on time is a crucial responsibility for all taxpayers in Pakistan, regardless of their location. The Income Tax Ordinance 2001 mandates that individuals and associations of persons (AOPs) must file their income tax returns by the 30th of September each year. Failure to do so can result in severe consequences, including default surcharges, penalties, and disconnection of utility connections by the Federal Board of Revenue.
It is worth noting that for tax year 2022, the deadline for filing income tax returns was extended for 15 days only, till 15th December 2022. Therefore, salaried individuals and other taxpayers must keep an eye on the deadlines and ensure timely filing of their returns.
Penalties for late filing or non-filing of income tax returns can range from Rs. 10,000 for salaried individuals to up to Rs. 50,000 for other individuals. Moreover, non-compliance of the return within the due date can lead to the removal of the individual’s name from the active tax payer list, which can result in being automatically selected for an audit under section 214.
Despite the consequences of missing the deadline, individuals may have valid reasons for not being able to file their returns on time. In such cases, it is possible to apply for an extension by writing an application to the Commissioner Inland Revenue. However, extensions are not guaranteed and are only granted in specific circumstances.
To avoid such penalties and other legal issues, it is essential to file income tax returns on time in Pakistan. Salaried individuals and other taxpayers should prioritize the deadlines and take necessary steps to ensure compliance. Additionally, if an extension is necessary, they should follow the proper procedures to request one.
In conclusion, taxpayers must understand the importance of filing their income tax returns on time to avoid the negative implications of late or non-filing. By adhering to the deadlines and being mindful of the consequences of non-compliance, individuals can stay compliant and avoid potential penalties.