How register NTN and Fill 181 (Form of Registration filed voluntarily) (Income Tax)

[butwhy]

I only answered your question that its not illegal to not file return.

I can also answer your risk based typical desi approach by one sentence without going into technical details: the person not filing return will be treated as non filer for deduction of withholding taxes(incidence of higher rates of withholding taxes) and will be ineligible to take benefit or claim refund of taxes paid over his admitted liability for year.

Notice for filing return and penalty is a secondary issue which rarely arises.

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That is why if you look again, I have suggested to file a return when you have to buy a car etc...When the real withholding tax gets you. Other than that, for day to day life, the withholding taxes are minimal at most, zero at best...

[butwhy]

I just read 2 things.

Every person is liable to file income tax return. And those are also required to file wealth statement.

Every one here is to help and I'm really grateful to all of you. As a Pakistani its our duty to pay Taxes.
Otherwise we don't have any right to scold politicians and corruption in general.

Abb ager Marica ja k un ko 45% Tax dete waqt dard nahi hota to Itna to Pakistan main reh k itna to day he saktay hen.
Baqi nai to Dubai account bnwa lena chaiay Tax free income ^_^

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Every person is not liable to file a tax return. But everyone who files a tax return is required to file a wealth statement.

I suggest you go to a proper tax attorney/accountant etc and get proper advice before doing something stupid on your own. Proper tax planning can save you A LOT of money in the long term.

[whiteangel]

That is why if you look again, I have suggested to file a return when you have to buy a car etc...When the real withholding tax gets you. Other than that, for day to day life, the withholding taxes are minimal at most, zero at best...

I have Rs.16000 in withholding taxes that I need to get adjusted in my next years return. So if you say withholding taxes are minimal, they are not.

[butwhy]

I have Rs.16000 in withholding taxes that I need to get adjusted in my next years return. So if you say withholding taxes are minimal, they are not.

The OP has mentioned his annual income slab. And also mentioned how long he's been working. From that you can sort of get an estimate.

Also, I suggested getting a proper accountant for advice. Proper tax planning can save a lot of money and hassle in the long term.

[Hassan0001]

I have Rs.16000 in withholding taxes that I need to get adjusted in my next years return. So if you say withholding taxes are minimal, they are not.

If you are an individual, carrying forward of credit is not an option. You can apply for refund though.

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[whiteangel]

If you are an individual, carrying forward of credit is not an option. You can apply for refund though.

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Well I have been carrying it forward and getting adjustments from my employer for the past couple of years as per the advice of my lawyer.

[butwhy]

Well I have been carrying it forward and getting adjustments from my employer for the past couple of years as per the advice of my lawyer.

What you're talking of is probably not carry forward.

I think what you meant was that you have currently paid 16k in withholding during this tax year (16-17) which will be adjusted in next calendar year (2017) when you file for return for this/that tax year (16-17). This is not carry forward.

[Khurramchauhdary]

Where to add the amount of withholding tax paid on the purchase of new car? In which tab what amout in what coloum? Detailed reply will be highly appreciated

[husainahmed154]

AoA ,

For filling tax return, one must fill the wealth statement. I am a normal salaried person. My tax is being deducted from my salary for the past many years, but I was not a filer. Now I plan to become a filer. First step is now to fill the wealth statement. I have following questions regarding wealth statement.

1) The inflows and outflows should be exactly equal in the wealth statement. So which salary should I mention in the wealth statement, Gross salary (before deduction of tax), or NET salary (after deduction of tax)? If I have to mention Gross salary, then under which option should i mention the tax deducted from my salary? Tax is already deducted from my salary through my company.

2) I give some amount monthly to some relative. Should i mention it in outflow->gifts? or Outflow->Others?

3) Apart from my normal salary, for the last one year I have been getting some extra amount through another project. The total amount is way too less than 400K per year, its around 150K per year. Should I mention this amount also in my main income? What if adding this additional 150K to my actual salary raises my tax slab? Where should I add this additional amount in my wealth statement?

Regards
Husain

[whiteangel]

1. You need to mention gross salary + any other income before deduction of tax.

2. If you are giving someone a gift, then the person who is receiving the gift will mention it in his wealth statement. Similarly if someone is sending you some money then you can declare it as a gift in your wealth statement.

3. Any other amount you are earning should be added to your total income for the financial year and is part of taxable income. So you need to add it to your salary income and pay tax on the total amount. This additional amount should be mentioned in your income tax return. In the wealth return you only mention the total income for the year. If the additional amount you are earning is coming through banking channel/cross cheque/account transfer, then FBR can question you about this additional amount and ask you if you have paid tax on it. If you are receiving it in cash and its not a huge amount, then you might be able to get away with it. If the additional amount you are earning is in the form of foreign remittance coming through normal banking channel, then it is tax exempt.

[bsienn]

3) If the additional amount you are earning is in the form of foreign
remittance coming through normal banking channel, then it is tax exempt.

Can you explain a bit more please?

Besides my regular job, I'm also earning through freelancing foreign and local clients, They pay me through bank transfer but mostly through payment processors like payoneer or paypal. In case of local clients easypaisa or western union.

This amount is not taxed or is it already I'm not sure how this works. How do I pay tax on this earning? Do I have to? Where should I mention this amount and tax about this earning?

[husainahmed154]

Thanks a lot for the clarification...

If I mention gloss salary, then in my wealth statement, where should I mention the tax which is already deducted from my salary? I have to make earnings and spending equal in my wealth statement. Should I mention the total tax deducted in "Others"?

[whiteangel]

I don't think payoneer or paypal would fall under the category of normal banking channel. But if you are withdrawing the funds you have in payoneer or paypal through a bank account in Pakistan, then it is not taxable. If you are receiving funds through Western Union or any other money exchange company, then you are liable to pay income tax on it. I know this sounds a bit strange, since Western Union is also a registered exchange so why are there different rules for money changers? I asked my lawyer the same question, he said that it's just the way it is in the tax regulations. So if you are getting funds from abroad, always try to get then through a bank so that it remains tax exempt.

[whiteangel]

You don't need to make your earning and spending equal in the wealth statement. A wealth statement documents the wealth you have accumulated up till now (cash, gold, property, vehicles, furniture etc.) and it shows your net worth. Every year you file a wealth statement showing the total earning/asset accumulation in that year minus the expenses you have incurred. If you make more money than you spend, the difference is added to your total wealth. If you make less and spend more, then the difference is deducted from total wealth.

The tax you have paid is mentioned in the expenses you have incurred... how much was spent on household expenses, how much tax you paid and any other expense and add up all those to show total expenses incurred in the year.

[husainahmed154]

Thanks a lot....
After your suggestions, Now I closely see that I can mention my taxed amount under the following

"Rates / Taxes / Charge / Cess" under Personal Expenses.

Many many Thanks.