Avoid These 7 Common Mistakes When Filing Income Tax Returns with FBR

Over the years, the Government of Pakistan has provided various benefits to individuals filing income tax returns. However, many individuals file incomplete or false declarations with the Federal Board of Revenue (FBR) in a rush to attain “Filer” status, leading to severe consequences such as strict audit proceedings, penalties, or assessments.

Here are 7 common mistakes to avoid when filing income tax returns with the FBR to steer clear of penalties, audit proceedings, or assessments:

1. Check Your FBR Maloomat Portal Before Filing: Before submitting your income tax return, it’s essential to review your FBR Maloomat Portal to ensure all relevant information is accurate and complete. FBR retrieves income, asset, and expense data from various sources, which should align with the information in your tax return.

2. Declare All Incomes, Including Investment Returns: Ensure that all sources of income, including profits from investments such as dividends, rental income, and capital gains, are accurately reported in your tax return. Many individuals overlook reporting income from investments, leading to discrepancies.

3. File a Complete Wealth Statement: Alongside income declaration, provide a comprehensive wealth statement detailing all assets acquired and held during the tax year, including bank accounts, properties, vehicles, and other investments.

4. Accurately Declare Expenses: Include all legitimate expenses incurred during the tax year, such as rent, vehicle maintenance, travel expenses, and household expenditures, in your tax return.

5. Submit Returns on Time: Avoid penalties by filing your income tax returns before the deadline. Late filing incurs penalties, with a minimum penalty of PKR 20,000/- for salaried individuals and 5% of the tax payable on business income for businesspersons.

6. Avoid Wrongful Tax Credits and Deductions: Ensure that tax credits and deductions claimed in your return are valid under the law. Seek advice from tax experts to ascertain eligibility for tax credits or deductions to prevent scrutiny from the FBR.

7. Revise Returns to Rectify Errors: Review your filed return thoroughly, and if errors or discrepancies are discovered, promptly revise your return within the 60-day window allowed by the FBR.

If you’re concerned about potential income tax notices from the FBR, seek assistance from reputable legal experts like Mithan Enterprises. We offer worry-free income tax return filing services to ensure compliance with regulations and mitigate risks.

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