The Federal Board of Revenue (FBR) Wednesday introduced a simplified return form for traders, making the declaration of deemed income mandatory under the new guidelines.

The move comes as part of the FBR’s ongoing efforts to streamline tax compliance and increase transparency within the trading community.

The notification outlines the new requirements for traders filing income tax returns for the tax year 2024 and beyond. The simplified return form, now available in both English and Urdu, is designed to facilitate a broader understanding and ensure accurate declarations among traders.

According to the new guidelines, traders must pay taxes on taxable income or final tax. Additionally, the declaration mandates the inclusion of deemed income under Section 7E of the Income Tax Ordinance, 2001. This section pertains to the calculation and payment of deemed income tax, a measure aimed at broadening the tax base and ensuring fair contributions from all traders.

The return form requires traders to declare various financial details, including business turnover or receipts, total trading purchases, other expenditures, net profit or taxable income, and any income other than business, such as interest or rental income. Traders with agricultural land are also required to declare it, along with any relevant bank account details.

The second part of the return form focuses on the details of taxes paid during the year. Traders must provide information about total adjustable tax payments, including those on profit from debt, telephone and internet services, electricity, and taxes collected from distributors, dealers, or wholesalers under Section 236G and from retailers under Section 236H. Furthermore, details of the purchase or transfer of immovable property under Section 236K and sale or transfer of immovable property under Section 236C must also be declared.

The FBR has also mandated the declaration of advance tax payments under the Tajir Dost Special Procedure, 2024. This special procedure aims to simplify the tax filing process for traders, encouraging compliance and reducing the administrative burden associated with tax returns.

Traders are required to declare immovable property, and movable property, including business capital, and other assets. This comprehensive approach ensures that all assets and liabilities are accurately reported, providing a clear picture of a trader’s financial position.