FBR Proposes Surcharge-Free ATL Entry for Late Filers

The Federal Board of Revenue (FBR) has proposed a facility that would allow individuals who file their income tax returns after the deadline to be included in the Active Taxpayers’ List (ATL) without paying the applicable surcharge, provided they agree not to acquire property for six months.

The proposed amendments to the Income Tax Rules, 2002 were issued through SRO 1690, with stakeholders given one week to submit their comments.

Under the proposed Rule 81B, late filers could qualify for surcharge-free ATL inclusion after submitting an undertaking through the FBR’s Inland Revenue Information System (IRIS).

As part of the undertaking, taxpayers would have to commit that they will not purchase, acquire or otherwise obtain ownership or a beneficial interest in any property for six months from the date IRIS electronically acknowledges Form ATL-U.

The FBR would be authorised to monitor compliance using information available under the Income Tax Ordinance, as well as data obtained from government authorities, agencies, registries, financial institutions and other lawful sources.

If a taxpayer is found to have acquired property during the six-month restriction period, the FBR would first provide an electronic opportunity for the taxpayer to present their case.

Where a violation is established, the taxpayer’s surcharge-free ATL status would be withdrawn from the date the breach occurred. Their tax status would then be determined under the existing rules applicable to late return filers.

The proposed Form ATL-U would require key details including the taxpayer’s name, CNIC or NTN, relevant tax year, date of return filing, IRIS acknowledgement or reference number, and the date on which the undertaking was submitted.