ByThe Federal Board of Revenue (FBR) has introduced a new option in its Tax Asaan app for the Tajir Dost Scheme. The scheme aims to bring unregistered businesses into the tax net and encourage them to declare their assets and income.
What is the Tajir Dost Scheme?
The Tajir Dost Scheme is a voluntary tax compliance scheme that offers benefits to unregistered businesses. Under the scheme, businesses can declare their assets and income and potentially receive benefits like reduced tax rates and simplified tax compliance procedures.
How to register for the Tajir Dost Scheme?
The exact registration process for the Tajir Dost Scheme may still be under development. However, based on the information provided, here’s a possible scenario:
- Download the Tax Asaan app from the Google Play Store or Apple App Store.
- Open the app and look for the “Tajir Dost Scheme” option (the option might be newly added).
- If available, follow the on-screen instructions to register. This may involve entering your ID card number, mobile number, and other required information.
- Submit the registration form.
Who are Eligible for the Tajir Dost Scheme?
The eligibility criteria for the Tajir Dost Scheme haven’t been officially confirmed. However, the scheme likely targets unregistered businesses, particularly those in specific sectors like:
- Retail stores
- Wholesalers
- Service providers
Cities in Pakistan where Registration under Tajir Dost is Compulsory:
Abbottabad, Attock, Bahawalnagar, Bahawalpur, Chakwal, Dera Ismail Khan, DG Khan, Faisalabad, Ghotki, Gujranwala, Gujrat, Gwadar, Hafizabad, Haripur, Hyderabad, Islamabad, Jhang, Jhelum, Karachi, Kasur, Khushab, Lahore, Larkana, Lasbela, Lodhran, Mandi Bahauddin, Mansehra, Mardan, Mirpurkhas, Multan, Nankana, Narowal, Peshawar, Quetta, Rahim Yar Khan, Rawalpindi, Sahiwal, Sarghoda, Sheikhupura, Sialkot, Sukkur and Toba Tek Singh.
How to Calculate Tax under Tajir Dost Scheme?
S.R.O. 1064 (I)/2024 is an amendment to the Tajir Dost Special Procedure, 2024, introduced through the Income Tax Ordinance, 2001. This amendment aims to clarify and expand the scope of the original procedure.
How to Pay Tax under Tajir Dost Scheme?
- Access Tajir Dost: Locate and click on the “Tajir Dost” icon on the Iris portal (After logging into Iris).
- Provide Business Details: You’ll be asked to input your business area. The system will automatically retrieve your business information.
- Calculate Annual Liability: Based on your business area, the portal will calculate your annual tax liability.
- Generate Payment Slip: Click on the “Create PSID” icon to generate a unique Payment Slip ID (PSID).
- Make Payment: Use the generated PSID to pay your monthly tax installment through online banking or at a bank branch.
Key Points
- Equal Installments: The total annual tax liability is divided into 12 equal monthly installments.
- Auto-Calculation: The system automatically calculates your annual tax liability based on your business area.
- Online and Offline Payment: You have the flexibility to pay through online banking or at a bank branch.
Indicative Income Tax Calculation Under Tajir Dost Scheme:
The Tajir Dost scheme employs an indicative income-based tax calculation method. This means that the tax liability is determined based on an estimated income rather than detailed financial records.
Tax Slabs and Rates of Tajir Dost in Pakistan:
The following table outlines the indicative income slabs and corresponding annual and monthly tax amounts under Tajir Dost:
| Indicative Income | Annual Tax | Monthly Tax |
|---|---|---|
| Up to Rs. 600,000 | Rs. 1,200 | Rs. 100 |
| Rs. 680,000 | Rs. 12,000 | Rs. 1,000 |
| Up to Rs. 1,000,000 | Rs. 60,000 | Rs. 5,000 |
| Rs. 1,350,000 | Rs. 120,000 | Rs. 10,000 |
| Rs. 1,833,333 | Rs. 240,000 | Rs. 20,000 |
The scheme aims to simplify the tax filing process for small businesses by providing a straightforward method for estimating tax liabilities.
Any person owning a shop of fifty square feet or less in a commercial area, or owning a makeshift shop, or ’khoka’, or kiosk, or small shop measuring not more than 5 ×3 square feet, shall be liable for fixed advance tax of twelve hundred rupees per annum Rs. 100 per month.
Advance Monthly Taxes under Tajir Dost on High-End Shops in Islamabad, Karachi, Lahore, Faisalabad, Rawalpindi and other major cities are upto Rs. 60,000 per month.
Key Changes Introduced in Tajir Dost:
- Definition of Person: The term “person” has been expanded to include a wider range of business entities such as wholesalers, dealers, distributors, retailers, manufacturers, importers, and those combining multiple business activities.
- Definition of Physical Place: This term now encompasses any location connected to business operations, including offices and homes used for business purposes.
- Introduction of Indicative Income: The concept of “indicative income” has been introduced. This is an estimated income determined by the Board based on factors like property rental value, location, and fair market value.
If you Don’t Register Tajir Dost Scheme by the Deadline?
FBR will make mandatory registration where information is available with them. Field officers visit and endorse compulsory registration.
- FBR usually register Taxpayers without their email addresses and mobile number hence you will face problems if you want to reset your FBR password in future.
- FBR only register your NTN and dont file your tax-returns under Tajir Dost. You have to file your tax-returns by yourself once your NTN is registered.
- If you dont file your tax-returns after registering your NTN, your SIMs and other services maybe blocked by FBR.
Who are exempt from Registeration under Tajir Dost?
Common Exclusions as from Tajir Dost specified under S.R.O. 457(I)/2024.
- Companies: Businesses registered as companies are excluded from the scheme.
- National and International Chains: Large chain stores operating across multiple cities are not eligible.
- Businesses with Multiple Outlets: Businesses with multiple outlets might not qualify under the scheme.
- Excluded by FBR: A class of persons specifically excluded by the Board
- Operating in other cities: Not in the list as mentioned by FBR
Frequently Asked Questions
- FBR Imposes Fixed Monthly Taxes on High-End Shops
- New Advance Tax Rules for Small Businesses under Tajir Dost Rule
- FBR Cracks Down on Untaxed Traders with New Registration Scheme
Conclusion
The Tajir Dost Scheme presents an opportunity for unregistered businesses to join the tax system and potentially receive benefits. Stay tuned for updates on the registration process, deadline, and specific scheme advantages. Consider registering if you believe your business falls under the eligibility criteria.
