Tax Filer Benefits In Pakistan

Pakistan is a developing country with a struggling economy. Every government that comes into power looks for different ways of collecting taxes, be it direct or indirect. But the investment of the nation in these taxes does not go in vain. It pays back in different ways and we will share how. Because in this write-up, we are going to talk about Tax Filer benefits in Pakistan.

Who is Filer?

Internationally, they call a filer a person who files any application, document, or petition in any governmental department or court of law. But here in Pakistan, we call a filer a person who files annual income tax and sales tax regularly. He/She gets listed on the "Active Taxpayer (ATL)" list compiled by the Federal Board of Revenue (FBR).

If you want to become a filer, submit your annual income tax return on the FBR's online portal IRIS. Once you become a filer, your name will appear on the Active Tax-Payer List (ATL), which is shared with the public by FBR. After appearing on the list, you become eligible to enjoy benefits of income tax return filing Pakistan.

Why Should I become a Filer?

First things first, it is the rightful duty of citizens to pay taxes levied on their assets. The government of Pakistan is also taking some serious steps in order to bring more people into the tax net. Non-filers are getting penalized. Meanwhile, filers are provided with different perks for their loyalty to the country.

Benefits of tax filer in Pakistan 2022

Apart from being a responsibility, filing taxes comes with many other perks. We are mentioning the Tax Filer benefits in Pakistan below for your better understanding.   

Half Withholding Tax

If you are a filer, you only have to pay half of the withholding tax. Meanwhile, people who do not file taxes have to pay the full amount.

Owning Property

If you are a filer, you are free to purchase any property in Pakistan. But people who run away from income tax cannot purchase property valued at over 50 lakh Pakistani rupees.

Relief for Importers

If you are a filer, you have to pay only 5.5% tax on the import of raw materials. But non-filers have to pay 8% on the total import for the same raw material.

Relief for Exporters

When it comes to commercial exports, filers only have to pay a 6% duty on each transaction. On the other hand, non-filers have to pay a 9% duty for the same transaction.

Cut on Dividends

Filers enjoy a 5% cut on dividends when compared to non-filers. When a company distributes the dividends (profit) among employees, a filer has to pay 15% tax. Meanwhile, non-filer has to pay 20% tax.

Cut on Banking Schemes

There are different schemes by banks that provide a return on investments or savings. Filer again enjoys a 5% cut in these schemes over non-filers as he has to pay 10% tax in comparison to 15% tax paid by the non-filer.

Property Transfer Tax

When people who file taxes transfer their property, they have to pay only 1% tax. But people who are not filers have to pay 2% tax for the same job.

Auction

When different auctions are held, be it private or government, filers save 5% on their taxes. They have to pay only 10% tax against 15% tax paid by people who do not file taxes.

Savings on Prize

When a tax-payer wins any prize money through a prize bond, he saves 10% tax. He only has to pay 15% tax when the non-filer pays 25% tax on prize money.

These were a few of the many benefits of becoming a tax filer in Pakistan. Let’s learn more about them.

Tax Net - Difference Between Filer and Non-filer

The tax paid once a year saves you from different petty taxes that can disturb your budget. Thus, it is better to pay taxes timely and get the benefits for tax filer in Pakistan. If you haven’t made up your mind yet, let us share some more differences between a filer and a non-filer. These Tax Filer benefits in Pakistan will surely spark the desire of filing taxes inside you.

• Bank Transaction     

Non-Filer

Cash Withdrawal Above PKR 50,000 - 0.60%

Bank Transfer, Cheque, Purchase Order Exceeding PKR 50,000 - 0.40%

Filers

Cash Withdrawal Above PKR 50,000 - 0.30%

Bank Transfer, Cheque, Purchase Order Exceeding PKR 50,000 - 0%

• Purchasing Vehicle

Non-filers

Under 851 CC    PKR 10,000

851 – 1000 CC   PKR 25,000

1001 – 1300 CC PKR 40,000

1301 – 1600 CC  PKR 1,00,000

Filers  

Under 851 CC    PKR 10,000

851 – 1000 CC   PKR 20,000

1001 – 1300 CC  PKR 30,000

1301 – 1600 CC  PKR 50,000

• Registration of Vehicle

Non-Filers

Under 851 CC     PKR 10,000         

851 – 1000 CC     PKR 25,000

1001 – 1300 CC  PKR 40,000

1301 – 1600 CC  PKR 100,000

Non-filers

Under 851 CC     PKR 10,000

851 – 1000 CC     PKR 25,000

1001 – 1300 CC  PKR 30,000

1301 – 1600 CC  PKR 50,000

• Transfer of Vehicle Registration

Non-Filers

Under 851 CC     PKR 5,000

851 – 1000 CC     PKR 15,000

1001 – 1300 CC  PKR 25,000

1301 – 1600 CC PKR 65,000

Non-filers

Under 851 CC     Nill         

851 – 1000 CC     PKR 5,000

1001 – 1300 CC  PKR 7,500

1301 – 1600 CC  PKR 12,500

FAQs

What are advantages of being a filer?

There are many benefits of being a filer in Pakistan. It reduces your taxes in different cases from purchasing a vehicle, or property to selling or transferring them.

Who should become a filer in Pakistan?

As per Pakistan’s Tax Law, people having an annual income of 40 lacs or above are supposed to file their taxes annually.

What is difference between filer and non-filer in Pakistan?

A filer is a person who files income taxes annually and appears on the list of active taxpayer issues by FBR. Meanwhile, a person who does not file tax is a non-filer.

What are tax payer benefits?

The tax benefit is all about reducing the tax liabilities. It assists people in paying fewer taxes with exemptions and exclusions. It also provides them with different rights over non-filers. 

Conclusion

We hope you are now well aware of the benefits of being tax filer in Pakistan. We would like to conclude this blog here with a piece of advice. Save yourself from different taxes by becoming a filer and enjoy the perks that are being provided by the government of Pakistan.