Islamabad: The Federal Board of Revenue (FBR) made a significant announcement on Thursday regarding the last date for income tax filing, as Bol News reported.
The FBR has stipulated that taxpayers submit their income tax returns by September 30, 2023. Importantly, the FBR has emphasized that no extensions will be granted for the deadline.
This decision follows a recent development involving the financially struggling Pakistan International Airline (PIA). On September 13, the Federal Board of Revenue (FBR) took the step of unfreezing PIA’s accounts.
PIA had been facing an outstanding payment of Rupees 8 billion, which was required to pay Rupees 2.5 billion to the FBR. This action was initiated after the FBR had previously frozen all of PIA’s bank accounts due to the airline’s failure to meet its federal excise duty obligations.
Consequently, PIA encountered severe financial challenges, including difficulties disbursing employee salaries, further exacerbating its financial woes.
What Is Income Tax?
Income tax is a financial charge that governments impose on an individual’s or entity’s income, and it is one of the primary sources of revenue for governments worldwide. This tax is usually levied annually based on the income earned during a specific fiscal year.
Income tax applies to various sources of income, including wages, salaries, interest, dividends, capital gains, rental income, and more.
Governments use income tax revenue to fund public services and programs such as education, healthcare, infrastructure development, defense, and social welfare.
The tax system is designed to be progressive, meaning individuals with higher incomes are generally subject to higher tax rates. This approach aims to distribute the tax burden more equitably and support those with lower incomes.
In most countries, tax is collected through withholding tax, where employers and financial institutions deduct a portion of an individual’s income at the source and remit it to the government on their behalf.
However, individuals are often required to file an annual tax return to reconcile their total income, deductions, and credits, ensuring they have paid the correct amount of tax. Failure to comply with income tax regulations can lead to penalties and legal consequences.
Income tax laws and regulations can vary significantly from one country to another, and they are subject to change over time. If necessary, understanding one’s tax obligations and seeking professional advice can help individuals and businesses navigate the complexities of income tax and ensure compliance with the law.