As a responsible Pakistani, you have to pay taxes on time. If you won’t, then you’ll face penalties for not filing your tax return. Under the tax laws, there are penalties if an individual fails to file an income return within the due date under Section 114 of the Income Tax Regulations. If the declaration is not submitted before the expiry date, that person will have to pay fines.
Now, look at the penalties that should aware of.
What Penalties Will You Face?
According to Section 114
Late Filing Penalties
0.1% of the tax payable for the missed tax year on any day and a maximum of 50% of the tax payable provided that the above fine is less than Rs 40,000 or no tax is paid in that tax year then that person shall have a pay fine of Rs. 40,000
But, when the level of income is 75% of the level of salary income and the level of salary income is less than Rs.50 lakhs, the minimum fine, in this case, is Rs 5000.
Fail to Provide Reconciliation of Wealth Statements
If you failed to present the reconciliation of wealth statements or the statement of wealth then you must have to pay the penalty of 0.1%/week of taxable income or Rs 100,000 whichever is excessive.
Fail to Submit Foreign Assets & Income Statement in due time
If you failed to submit these assets, then you have to pay a penalty of 2% of foreign income or assets per year.
Penalty on Misleading
In this case, you have to pay Rs 25,000 or 100% of the tax amount.
According to Section 182A
As per FBR regulations, the taxpayers who do not file their returns by the due date will not appear on the list of active taxpayers for the year the returns were paid. That person will only be included on the list of active taxpayers on condition that he/she will pay the following surcharges:
- Rs 1000 (Individual)
- Rs 20,000 (Company)
- Rs 10,000 (An association of persons)
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Other Penalties of being Non-Filer
The taxpayer’s failure to file an income or wealth declaration without an excuse within the time limit prescribed by the court is considered an offense and is punishable by law, with an individual being liable to a fine of not more than fifty thousand rupees or imprisonment for more than two years or both.
Are Paying Taxes and Filing the Same?
Often people get confused about the difference between paying taxes and filing taxes. Both are different terms with different concepts. In this respect, people escape from the responsibility of “tax returns”.
Paying taxes is like paying the government the amount of tax you owe on the categories of wages, business income, utilities, vehicles, property, and other sources. On the other hand, filing a tax return is equivalent to documenting your taxes paid in and requesting a tax refund in case of overpaid taxes.