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Advantages of Being Filer in Pakistan

The Government of Pakistan is offering 150+ instances/activities where Filers can save a significant amount of money in order to promote tax filing. By submitting your income tax declaration with the Federal Board of Revenue (FBR), you will be able to take advantage of many opportunities to save money that non-Filers are not privy to. Each day, more and more instances are being created to offer maximum tax benefits to those with a Filer Status. If you are willing to file your taxes, you could stand to save a considerable amount of money.

There are many instances where filers enjoy tax benefits in Pakistan. Some of the benefits that the government provides to filers are detailed below for your knowledge and reference:

-Filer enjoys lower rate of taxation as compared to non-filer

-Filer is entitled for rebate/refund under different tax laws

-Filer can avail Tax amnesty

Benefits of being Filer in Pakistan by Federal Board of Revenue (FBR)

If you're a filer appearing on the Active Taxpayer List (ATL) of the Federal Board of Revenue (FBR), you'll only have to pay 1% tax on the purchase of immovable property like houses, flats, or plots. However, inactive taxpayers or non-filers will have to pay 2% tax on the same purchase. Similarly, filers will have to pay 15% tax on prize bond winnings, while non-filers will have to pay 30% tax. Finally, if you're a filer with a savings or profit bank account, you'll be taxed 15% on any profit or yield received from the bank. Non-filers, on the other hand, will be taxed 30% on such income.50% concession over tax payable by Filer or registration of Vehicle as compared to tax payable by non- Filer.

As a filer, you are required to pay 5.5% tax on imported raw materials, as compared to 11% for an inactive taxpayer/non-filer. Similarly, you are required to pay 15% tax on dividend income, compared to 30% for a non-filer.

When importing goods commercially, you are only required to pay 6% tax at the customs stage, compared to double that amount (12%) for a non-filer. Additionally, 10% tax is payable by filers on goods sold by auction, while 20% is payable by inactive taxpayers/non-filers.

Finally, 4.5% tax is payable by filers on commercial supplies of goods, compared to 9% for non-filers. Active taxpayers will be subject to a 10% tax on the provision/sale of services, while inactive taxpayers will be subject to a 20% tax. Non-filers will be required to withhold 15% tax on the execution of contracts, as compared to 7.5% for filers. Filers will be subject to a 12% tax on commission, while non-filers/inactive taxpayers will be subject to a 24% tax.

As can be seen from the data, overall, a non-filer pays twice the amount of tax as compared to an active filer on almost all activities/instances. These taxes are automatically deducted at source, so they cannot be avoided.

For example, the profit or yield from your savings account is received after the bank deducts taxes according to your filing status. Similarly, when you register a vehicle, the excise authority charges taxes accordingly to your existing filing status, and without payment, your vehicle cannot be registered.

As a filer, you're entitled to a number of tax benefits that can save you money. Our Tax Experts at Burhan & Associates can help you take advantage of these benefits by filing your income tax return quickly and easily. We'll help you get your filer status in just a few hours, so you can start enjoying the benefits right away. Contact us today to get started.

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