2.4 million taxpayers automatically selected for audit


ISLAMABAD: About 2.4 million taxpayers have been selected for audit, who have obtained National Tax Number (NTN) but failed to file income tax return for tax year 2017.
The Federal Board of Revenue (FBR) has received provisionally 1.1 million income tax return for tax year 2017 by November 15, 2017, which was the last date for filing the return for salary persons and business individuals.
The FBR sources said that this number will be increased by around 0.2 million of those taxpayers, who had filed income tax returns manually.
This means the number of filed returns may reach around 1.3 million. If income tax retruns filed by corporate entities due on December 31, 2017, this number may reach 1.35 million.
As per Section 114 of Income Tax Ordinance, 2001 every person, who obtained NTN is required to file income tax return.
The issued NTNs are around 3.75 million out of which only 1.35 million filed their returns, which means around 2.4 million non-filers.
As per Section 214D of the Income Tax Ordinance, 2001 all those taxpayers will be selected for audit automatically if failed to file their returns by cut of date.
The Section 214D explains:
Automatic selection for audit.—(1) A person shall be automatically selected for audit of its income tax affairs for a tax year, if—
(a) the return is not filed within the date it is required to be filed as specified in section 118, or, as the case may be, not filed within the time extended by the Board under section 214A or further extended for a period not exceeding thirty days by the Commissioner under section 119; or
(b) the tax payable under sub-section (1) of section 137 has not been paid.
(2) Audit of income tax affairs of persons automatically selected under sub-section (1) shall be conducted as per procedure given in section 177 and all the provisions of this Ordinance shall apply accordingly.

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