No columns for foreign currency in wealth statement: KTBA pinpoints irritants

KARACHI: Karachi Tax Bar Association (KTBA) has pointed out serious irritants in the income tax return and wealth statement forms as it informed Tariq Bajwa, Chairman, Federal Board of Revenue (FBR) on Tuesday that there is no column in the wealth statement in respect of foreign currency account.
It said in a letter sent to FBR chairman on Tuesday, the KTBA president said that the last date for filing the return of income along with wealth statement for tax year 2014 is October 31, 2014 as extended by the FBR.
In continuation of our earlier letters wherein various issues were pointed out in respect of the forms of return prescribed by the FBR and the automotive system “IRIS” uploaded on web portal on September 16, 2014.
The KTBA informed that the system had been reported not to be functional in certain days due to unknown reasons and our members have communicated that in fact the system was not working on October 27, 2014.
Secondly, the information sought by the system does not correspond with the earlier requirement of the Return as such the gathering / compiling of such information is quite time consuming.
For example in the preceding year’s Tax Returns the information in respect of Income under the head of Salary a tax payer was required only to submit gross salary received (and rightly so, as the same is taxable on the gross basis).
However, the new returns require an employee to bifurcate its income from salary to gross pay, allowances, reimbursements and other payments.
Such information as stated above needs further compilation of the data which requires sufficient time. As the employer’s certificate does not contain such bifurcation as such same becomes more complicated.
The other problems faced by the members are narrated below:
— There is no provision in the return in respect of refund application.
— There is no power given to tax payers to update his or her profile as the same was made available in the preceding year’s tax return.
In the cases where Federal Securities such as Special Saving Certificates, Defence Saving Certificates are purchased from banks, the system does not provide the name of Bank as its field is restricted to National Saving Centers only.
While reporting the Income of such certificates purchased from Banks, the Column for reporting Income U/s 151 similar problem exists that the system does not provide the bank information and is restricted to National Saving Centers only.
Similarly in the case of profit on debt earned by an individual from a private arrangement, there is no space available to mention the name, identification of the source from where profit on debt has been received.
It may also be noted that columns No 9 to 11 of Wealth Statement which relates to “Precious Possession”, “House-hold effect and Personal Items”. Our view is that this is very cumbersome and is not at all practical / possible. As such it should be replaced as per the relevant Column of the Wealth Statement of Tax year 2013.
It is to be noted that printing of report on IRIS software is not on the basis of prescribed format of Income Tax Return as per Income Tax Rules, 2002.
Taxpayers are unable to add rows in any part of Return, Annexure and Wealth Statement to fill up or add data.
It is to be noted that in Wealth Statement NTN number is not updating automatically neither it allows any update. NTN number in Wealth Statement appears as (Fixed) 01234567. It does not allow to put NTN in that column.
In the return of income for company, tax is computed automatically at the rate of 34 percent; whereas in the case of banks, oil companies, modarbas etc. the rates are different.
Therefore, it is suggested that computation of tax be allowed to taxpayers instead of auto compute.
Further to above problems, frequent power failure and more particularly, law and order situation has restricted the work of filing of Return by the tax professionals and our members.
The FBR chairman has been requested to extend the date of filing of all the Returns due to be filed by October 31, 2014 up to Dec 31, 2014, which shall facilitate the taxpayers and tax professionals to file the Returns and pay due taxes to the national exchequer.

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