Income tax is a type of taxation you pay the government from your earnings. Many people evade filing taxes because they don’t understand the benefits of having a track record with the country’s revenue department.
Read: HOW TO BECOME A FILER IN PAKISTAN
Importance of Tax Filing
As a responsible citizen of the state, you must share with the government all the details of your wealth. Also, revenue collection is a vital source for any economy to function and assist its citizens in meeting their basic needs.
But if you file your tax diligently, you can get the excess you have paid over your salary bracket from the government.
Everyone is paying taxes knowingly or unknowingly. Every product you buy comes with a government tax levied as a sales or consumption tax. Therefore, if you start keeping a record of all your expenditures and not just earnings, you may be eligible to file for Income tax returns.
Can The Tax Be Refunded?
The short answer is yes. You can claim the excess tax you have paid to the government while you were shopping for the monthly groceries or investing in a car or real estate. But it comes with the requirement that you must register with the FBR.
If you fall in the income slot where income tax does not apply, you don’t need to pay income tax to the government. However, if your salary bracket comes under the taxable income, to be eligible for a tax refund, you must pay the annual tax to the government.
Procedure For Reclaiming Refund
To be able to file for returns, you need to ensure that you have been keeping bills and receipts of all your spending throughout the year. Look for the word withholding tax or advance income tax on the receipts and keep them safe.
1- Go to the FBR site and log into IRIS, which is the online portal where income tax returns are filed.
2- You need to complete the Income Tax Return Form and Wealth Statement Form.
3- For salaried people, FBR has provided a Declaration form 114(I) to assist in filing their income tax returns.
No matter if you are a salaried individual or run your own business, by choosing to stay a non filer you are leaving a good amount of money on the table.
The government has also provided a refund adjustment tab to make tax-returns filing smooth, improve the ease of doing business, and decrease the compliance cost for taxpayers.
If you require consultation on all tax-related matters, Tax Home is a professional consultancy firm a call away. Contact us to know more about our services.
