Hidden Rules & Crucial Steps for Filing 2025 Income Tax Return in Pakistan

 

Introduction: The Mandate of Filing Income Tax Returns

Every year, thousands of Pakistanis face the same challenge: filing their income tax return and wealth statement. For the 2025 tax year, this duty is more important than ever. Filing is not only about securing the status of a “filer,” it is a legal and national responsibility. Timely filing ensures compliance with the law, avoids penalties, and contributes to the national economy.

The law requires every registered taxpayer to file their return within the stipulated deadline. Missing it can create unnecessary financial and legal trouble.

Essential Preparations Before Filing Your 2025 Return

Before logging into the FBR’s IRIS system, taxpayers should prepare carefully. Missing documents or ignoring FBR-linked data can result in mistakes, penalties, or even the rejection of a return.

A. Reviewing FBR-Linked Information

The first step is to review the information already linked with FBR:

• MIS Report: This shows deductions, bank profits, property sales/purchases, and tax already deducted. If your MIS shows a property sale but you don’t declare it, the FBR may reject your return.
  

  📌 Example: Ali sold a plot in 2024, and the tax was deducted at source. If he ignores this in his return, FBR will detect it from MIS and flag it as under-reporting.
  📌 Example: Sara traveled abroad five times last year. This expense is reflected in E-Maloomat. If she declares income too low to support such travel, the FBR may raise a red flag.

• E-Maloomat Section: This includes details like foreign travel or property purchases. FBR uses this data for cross-checking.
  

B. Compiling Bank Statements

Taxpayers often make the mistake of only collecting one bank statement. But all bank accounts must be declared.

• The tax year runs July to June.

• Consultants should prepare a reconciliation of transactions.

• Each account must be shown in the wealth statement.

• Movement of money must be explained clearly.

📌 Example: Bilal received money from freelancing into Account A and transferred it to Account B for savings. Both accounts must be declared to avoid suspicion.

C. Consequences of Non-Compliance or Concealment

Ignoring available records can invalidate your return. FBR can reassess, impose taxes, and even penalties. Filing an accurate and transparent return today helps avoid unnecessary stress tomorrow.

Challenges and Errors within the FBR Portal (IRIS System)

Even with preparation, the IRIS portal itself creates hurdles.

A. Incomplete Access and Auto-Feeding Issues

• As of August, taxpayers don’t have complete access to the portal.

• Auto-fed data often shows incorrect figures.

• Property sales and tax deducted at source may appear with wrong values.

• Salary income sometimes appears lower than the actual MIS-reported income.

📌 Example: Ahmad’s MIS showed Rs. 2.5 million salary, but IRIS only auto-fed Rs. 1.9 million. If uncorrected, this mismatch could cause a notice.

B. Calculation and Declaration Errors

• Value calculation errors are common.

• The system sometimes rejects correct entries from business records.

• Deductions entered manually may not be accepted.

• Differences often exist between MIS deductions and IRIS allowances.

📌 Example: A business owner claimed tax credit for utility bills as per records, but the system rejected it due to calculation bugs.

C. Impact on Timely Filing and Assessment

These errors delay proper filing. Government contractors or companies often need urgent returns for tenders or registrations. If portal issues persist, taxpayers suffer.

As deadlines near, IRIS often slows or crashes in September due to heavy load. Without fixes, the government may be forced to grant extensions.

Recommendations and Deadlines

A. Call to Action for FBR

Filing is the responsibility of taxpayers, but ensuring a smooth system is FBR’s duty. Portal errors must be resolved early so taxpayers can file on time. Otherwise, last-minute rush will overload the system.

B. Legal Deadline for Filing

• By law, taxpayers have 90 days to file after notification.

• The return form was notified on August 18, 2025.

• Therefore, the legal deadline is November 18, 2025.

FBR should widely publicize this deadline so taxpayers are aware and ready.

Conclusion: Filing Returns is a Shared Responsibility

Filing your 2025 income tax return is not just about compliance it’s about being a responsible citizen. But responsibility is shared: taxpayers must file honestly and on time, while the FBR must provide a reliable system.

A correct and timely return protects you from audits, penalties, and future disputes. By preparing carefully, reviewing MIS and E-Maloomat, reconciling bank statements, and staying mindful of the November 18 deadline, every taxpayer can file with confidence.