KARACHI: Federal Board of Revenue (FBR) has said that taxpayers should ensure filing their returns by December 15, 2018 in order to get their names in Active Taxpayers List (ATL).
Otherwise they will be deprived of availing benefits for at least one year or till the filing of their returns in next years within due date.
The FBR has extended the last date for filing income tax returns by salaried persons, business individuals, Final Tax Regime, Association of Persons and corporate entities falling under special financial year up to December 15, 2018 from November 30, 2018.
According to a circular issued by the FBR, a person who is unable to file return within the date stipulated under Section 118 of Income Tax Ordinance, 2001 or within the date extended by the revenue board or the concerned commissioner under Section 214A and 119 of the Ordinance shall no longer be entitled to appear on the ATL for the year for which the return of income is not filed within due date i.e. late filer shall no longer be treated as a filer.
FBR further explained that an explanation has also been inserted in Section 182A of the Ordinance whereby it has been clarified that Section 182A of the Ordinance shall have prospective effect and shall only be applicable for the returns due for the tax year 2018 and onwards for which the first Active Taxpayers List to be issued on March 01, 2019 under the Income Tax Rules, 2002.
Therefore, taxpayers should ensure that their income tax returns for the tax year 2018 and onwards are filed within the due date under Section 118 of the Ordinance or the date extended under Section 214A and 119 of the Ordinance in order to avoid higher rates of withholding taxes across a multitude of transactions applicable to non-filers viz-a-viz filers.
The FBR further explained that in terms of the newly inserted section 182A of the Ordinance, a person who fails to file return of income within the date specified under section 118 of the Ordinance or within the date extended under Section 214A and 119 of the Ordinance, in addition to exclusion from ATL for the relevant tax year as explained above shall not be entitled to carry forward any loss to the tax year for which return of income is filed late.
The losses which cannot be carried forward to the tax year for which return of income is filed late, can however be carried forward to next year following the tax year in which return is filed late if the return for that year is filed within the due date.
However, the condition specified in sub-section (2) of Section 57 shall apply that no loss shall be carried forward to more than six tax years immediately succeeding the tax year for which the loss was first computed.