Stakeholder Acknowledgements Stakeholder Acknowledgements

Stakeholder Acknowledgements Stakeholder Acknowledgements

July 2013 Stakeholder Acknowledgements Stakeholder Acknowledgements Taxpayer Forums Income Tax Advocacy Seminar Press Conference Media Trainings ...

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July 2013

Stakeholder Acknowledgements

Stakeholder Acknowledgements

Taxpayer Forums

Income Tax Advocacy Seminar Press Conference Media Trainings

Success Stories

Profile of the Districts

Guidelines for Filing Income Tax Returns

The following stakeholders have expressed their acknowledgment for TheNetowrk for Consumer Protection & USAID. Mr. Manzer Khursheed Sheikh President Rawalpindi Chamber of Commerce & Industries (RCCI). I on behalf of Rawalpindi Chamber of Commerce and Industries express my greatest gratitude to The Network for Consumer Protection for initiating “Pay Income Tax Project” with the support of USAID. This project is helping us understand the tax matters in a convenient way and bridging the gap between our members and the tax authorities. With even better understanding of the tax laws and taxpayers' right, we are feeling proud to fulfill our duties to our beloved Pakistan.

Dr. Khalid Saeed President Attock Chamber of Commerce & Industries. I appreciate the efforts of The Network for Consumer Protection (Pay Income Tax Project) in promoting the income tax culture in district Attock, which helps broadening the tax net and economic development of the country. Khuwaja Baber Saleem Chairman Chakwal Press Club Through TheNetwork's intervention the local journalists were made aware of the fact that how positive media reporting on tax related issues can contribute in improving tax culture in the District. I appreciate TheNetwork's efforts of training local journalists on tax related matters and guarantee that it will have a positive impact on tax culture in the future.

Mr. Haji Muhammad Zaheer President Jehlum Chamber of Commerce & Industries. Unfortunately Pakistan is among the countries that have lowest tax to GDP ratio. One of the biggest reasons is the lack of trust between the taxpayer and the tax collectors. TheNetwork's intervention “Pay Income Tax Project” is helping rebuild the relation of trust. This intervention was much needed for the economic development of Pakistan. Today we have better services available at RTO Jhelum. On behalf of the members of Jehlum Chamber of Commerce and Industries, I thank TheNetwork and all associated with it. Adnan Saeed Tax Consultant appreciate the efforts of The Network for Consumer Protection (Pay Income Tax Project) in promoting the income tax culture in districts Chakwal, Jehlum, Attock and Rawalpindi, which helps broadening the tax net and economic development of the country.

Taxpayer Forums

Taxpayers Forum with members of Rawalpindi Chamber of Commerce & Industry (RCCI) May 6, 2013

Taxpayers Forum with Staff Nurse of Benazir Bhutto Hospital, Murree Road, Rawalpindi June 6, 2013

Taxpayer Forums show our profound commitment towards “Pay Income Tax” for nation’s development. Through tax payer’s forums TheNetwork aims to raise awareness for citizens to get tax education and play their responsible role. Indeed, these forums are 12 in total and 5 conducted during February April 2013 in the targeted districts of the project i.e. Rawalpindi, Jhelum, Chakwal & Attock on the following aspects n Macro picture of Pakistan

economy n Snapshot of the Budget of

Pakistan (2012-13) n Income tax e-filing on

FBR’s portal n Complaint redress

procedures (FBR, FTO & others) Taxpayers Forum with Faculty of Fatima Jinnah Women University, Rawalpinid May 21, 2013

More than 20 participants got tax education in tax payer's forum.

Campaign for bill of rights

Taxpayers Forum with Faculty of COMSATS Attock June 13, 2013

Rawalpinid Chember of Commerce & Industry Women Entrepreneur July 25, 2013

1. Production of radio spots specially designed public service messages have been developed & will be aired in August-September as the date to file income tax returns is nearing. 2. Designing of billboards: A billboard campaign has been specifically designed to promote tax compliance culture in the targeted districts. the billboards will be installed in the month of August-September along with the radio campaign.

July 2013

Income Tax Advocacy Seminar Jhelum May 22, 2013

Chakwal June 20, 2013

In order to build consensus on tax compliance in the district level, TheNetwork conducted income tax advocacy seminar with diverse stakeholders i.e. member of Jhelum Chamber of Commerce & Industry, trade unions, lawyers, human rights & social activists, women university faculty, doctors and nurses for their tax education & sensitize them for tax compliance. Indeed, seminar was chaired by the political elite of the town i.e. MNA Ch Khadum Hussain, MPA Ch. Lal Hussain.

TheNetwork conducted income tax advocacy seminar in Chakwal Chamber of Commerce & Industry indeed across the board i.e. Presidents of Hardware union, Sarafa union, Garment unions etc. Moreover Income Tax officer (ITO-Chakwal) Mr. Abdul Kareem made key note address which covers complaints of taxpayers and make himself as facilitator for taxpayers.

Press Conference

Press Conference Chakwal May 28, 2013 Periodic press conferences in the target districts are organized for wider dissemination of the message. Press conference was an eye opener for journalists who were of the view that the government is over spending in their district compare to or vis a vis their revenue generation from district. Indeed, press conference made the ground breaking penetration and changes the paradigm setting of journalist's perception. All leading newspaper and broadcasting covers the event exclusively.

Media Trainings Media Training-Jhelum & Chakwal May 29, 2013, June 11, 2013 respectively Training of the media persons from electronic and print media was organized in District Jhelum & District Chakwal. They were trained on how to report Income tax related matters and become pro-active advocates of income tax. Mr. Sarwar Munir Rao, renowned legend in investigation journalism conducted trainings as resource person.

July 2013

Success Stories Some Facts l Pakistan has lowest tax to GDP ratio 9.2% in the region. l In 2012, only 691,000 plus people of Pakistan filed their income tax return in a population of more than 180 million people. l USAID

supported the thematic area “Taxation for Development” and TheNetwork for consumer protection aimed to intervene in four districts of Punjab i.e. Rawalpindi, Jhelum, Chakwal, Attock as pilot project to sensitize people on direct taxation.

Saima Asgher

Dr. Saddam Hussain

“Our Future is very weak, and will continue to be, marked by lowest tax to GDP ratio, rapid population growth, undocumented economy, and incomplete, inaccurate and unclear information by the tax authorities” said Saima Asgher, lecturer, Government women degree college Jhelum, speaking at the post graduate class room/ Economics students. Then she appreciated the commitment of TheNetwork for consumer protection and USAID who provided the complete, accurate, clear and timely information to file the income tax returns and take back the advanced paid taxes i.e. Telephone, Mobile, Motor car registration etc on September 31.

Tax revenues are considered the back bone of a flourishing economy but sadly in Pakistan we lack tax education and tax compliance culture which in turn seriously hampers our country's growth said Dr. Saddam Hussain Assistant Professor at COMSATS Institute of Information Technology Attock Campus during his lecture with Post Graduate students of Management Sciences. Admiring the efforts of TheNetwork for Consumer Protection in collaboration with the USAID he added that the frequency of such efforts should be increased in order to educate potential tax payers which in turn would broaden our country's tax base.

“In district Chakwal Rs. 8 million tax revenue was collected as compared to the targets that were about 800 million and the budget of District is 4115 million.” Mr. Abdul Kareem ITOFBR Chakwal The total tax revenue target for District Chakwal was estimated to be 800 million but only 8 million was collected as commented by Income Tax Officer Chakwal (ITO) Mr. Abdul Kareem. In Chakwal, there was a scenario like traders were feeling insulted after receiving continuous notices from FBR, and even more insulting was the sealing of their bank accounts and issuance of arrest warrants. TheNetwork provide such forum to taxpayers & tax authorities to resolve their complaints TheNetwork's intervention proved very effective. We were able to provide a dialogue forum between the tax authorities and potential taxpayers. In the presence of traders from Sarafa bazaar, Hardware market, Electronic market, Fruit and Sabzi mandi, Landa bazaar etc Mr. Abdul Kareem focused on giving confidence to the traders on paying Income Tax which would in turn result in

taxation for development. The only tax practitioner in Chakwal was also present on the occasion and was the foremost reason of the tax revenues being so low, misguiding traders and filing their returns BTL(below the line). Mr. Abdul Kareem stressed on the fact that rather being tax evaders, traders should pay at least some amount as Income Tax. He offered his services and committed that he is available in his office and is willing to solve all the issues of the business community.

July 2013

Profile of the Districts

July 2013

Profile of the Districts

July 2013

Guidelines for Filing Income Tax Returns Significance E-filing of tax returns began to lesser mistakes, cut down on paper work and to decrease operating expenses. This method of filing of tax returns has been improved and expanded since its inception to permit additional taxpayers to use it. E-filing can be used to file almost all individual and business tax returns. It can also be used to make a payment for taxes due, request an extension and request a tax refund. It is the quickest method to use.

After completion of e-enrolment process User-ID and Password is issued to applicant. (b) How to do e-enrolment by companies etc. Following information are required for eenrollment of company: • Company NTN. •Registration number. •Director NTN. Thereafter you will be issued User-ID (through e-mail), Password (via SMS) and

Considerations Check the fbr website for a listing of places to e-file your tax returns. These are divided among the various types of filing (i.e. individual, business, corporate). Using e-file to file your tax returns will ensure all required forms are completed and no errors exist on your return. You will also get a confirmation within few hours of acceptance of your tax return from the e-fbr portal and a faster refund. Users of e-filing Following are the legal entities that can avail e-filing services provided it fulfills all the requirements of FBR. • AOP (Association of Persons) • Company • Individual These are defined as under; AOP (Association of Persons) Is defined in law as a firm, a Hindu undivided family, an artificial juridical person or anybody of persons formed under foreign law. -

Jamil Akhtar


Jamil Akhtar

A Company A legal entity formed to carry on a business for profit and that is registered under Companies Ordinance, 1984. The board has further clarified that e-filing mode for the submission of income tax returns is required for all individuals and companies.

PIN (by courier) for e-Filing. II.

E-filing Procedure


How to open annual return of income tax 1.1


b) In case of Company or Individual/AOP select from the list of yearly Returns. 1.4 Menu.

Due Date for e-filing of IT-1 (Company) is 31st December for companies whose year-ending date is 30-06-2012. Due Date for e-filing of IT-2 (Individuals / AOP / Others) is 31st October.

Stepwise Income Tax Return e-Filing Guidelines


E-enrollment Procedure The tax payer MUST BE ENROLLED on the e-FBR Portal, in order to file its Income Tax Return. After eenrollment now tax payer can file tax returns and statements. To begin e-filing of Returns and Statements, enrollment is necessary. Earlier individuals, companies, and AOPs had to enroll themselves manually but after introduction of efiling system now there is a facility of e-enrollment. (a) How to do e-enrolment by individuals (i) Entering your NTN number. (ii) Enter CNIC as it is printed on NTN Certificate. Enter secret required data.

Select the Return type from Left

2. Sections of income tax return form 2.1

Registration Section This section contains the information about the registration of taxpayer. When you open the re t u r n , t h i s i n fo r m a t i o n i s automatically filled by the system. If you want to change the information regarding registration, click the link “Click Here to update”.

An Individual A person who is resident of Pakistan or non-resident if he is fulfilling criteria of Income Tax Ordinance, 2001.

Due Date for e-filing of IT-1 (Company) is 31st October for companies whose year ending date is 31-122012.

Selecting the Tax Payer / Return. a) In case of e-Intermediary Select the Client from the list of Taxpayers.

Following are the fields that are editable in this section; § Employer NTN / Name § Representative NTN / Name § Year Ending

Guidelines For E-filing of Tax Returns in PAKISTAN

CA / CFC / MBA Director Tax & Corporate Services Avais Hyder Liaquat Nauman Chartered Accountants a member firm of RSM International

Login the system.

1.2 After Login, click the Menu Item shown below.


Shareholding / Ownership Section This section is also locked on income tax returns Form. If you have declared your shareholders / Owners in the Registration -> Enrollment -> Profile Management (Directors/ Shareholders Section), those will be shown here. This section is mandatory for the following types of Taxpayers: o

Corporate (Company)


AOP (Association of Persons)

If you are of any one of the above taxpayer types, you will be required to provide your Shareholders / Owners details in order to submit your returns. Click the link “Click Here to update” in the Registration section of the return to go to your Profile Management and add the

July 2013

Shareholders / Owners details under the section Directors/ §

Shareholders there (Move to step 2.2 after updating your profile) Note: In case of Non-Resident Company, please specify at least one Non-Resident Shareholder with the capital invested locally.

Word Document or Place them into different worksheets of a workbook and then attach the workbook. Make sure that the size of the file is not more than 4MB. Remove additional images, details to reduce the size of the file.

2.5 Payment/Refund Section. § The last section Payment/Refund contains bank information fields. Bank fields are only for those who have Net Tax Refundable. (This feature has been added for future) § If Bank Branch is not available. Don't fill data in these fields.


Other Sections of The Return




There are 3 annexures in the return form;

Save § Fill and Save the IT Returns Form, to prepare your Return. Click “Save” button to do so. § Save will only be available before verification. Once the return is verified / submitted, the save button will be disabled.

Fill the rest of the Return (Only the fields that apply to you).

(i) Annexure A (Link: Annex A Tax Amortization / Tax Depreciation) (ii) Annexure B (Link: Annex B Brought forward loss adjusted / Loss for the year carry forward) (iii)

Annexure C (Link: Annex C Tax Already Paid)

Note; § Please make sure that the Pop-Up Blocker in Internet Explorer is disabled before clicking the links of Annexures. § The Rate of Gross Tax is auto-calculated according to your details/declarations. § All the fields in Yellow color are auto-calculated by the system. § In case of Annexure B, no amount is brought back to the main return form, from the annexure. Clicking an Annexure Links opens a help screen to calculate the values. Popup Blocker should be disabled in order to view this screen. Enter the values in the fields that apply to you and when you are done, click the “Save” button on the annexure. 2.4 Audited Accounts Section (ONLY for IT-1 (Company)) The Corporate Taxpayers are required to attach copy of Audited Accounts/Balance Sheet/income Statement details as required under subsection 2(A) of section 114 of the Income Tax Ordinance, 2001 and under clause 2 of the 2nd schedule of the Income Tax Rules 2002. In order to attach, click the “Attach/Remove” link. On clicking the link, the following window will open: Click the “Browse” button to select the file. The file can be only of the following types: § PDF § Microsoft Word Document § Microsoft Excel Workbook After selecting the file to attach, click the “Attach” button. And the file will be attached in a while (depending on the size of the file). As soon as the file is attached, a “Tick” mark is visible against the “Attached” word on the Main Return Form. To remove an attached file, click the “Attach/Remove” link and in the pop-up window, click the “Remove” button. Note; § If you have multiple files, merge them into a single PDF,


Buttons in the form

Benefits of E-filing These are the benefits of e-filing: (i) Convenience easy access You can electronically file 24 hours a day, 7 days a week. (ii)Security Your tax return information is encrypted and transmitted over secure lines to ensure confidentiality. (iii)

Accuracy Electronic filed returns have 13 percent fewer errors than paper returns.


Proof of Filing An acknowledgment is issued when your return is received and accepted.

(v)Direct Deposit You can have your refund direct deposited into your bank account. There are number of targets which have been achieved by using e-filing system and e-filing system has facilitated different government departments, agencies as well as common users in number of ways.

Now different

Government institutions can better use information collected by e-filing system to their benefit, they have more effective, efficient and timesaving way of communicating and working with each other.

Thus it increases responsiveness of

Government sector in delivering public services. Apart from that it also bring Government close to citizen by providing them with easier access to information through personnel computers, internet, fax and other communication services.