The Federal Board of Revenue (FBR) has implemented significant changes to the reporting requirements for registered persons under the Sales Tax Act, 1990, and the Federal Excise Act, 2005. Through Notification S.R.O. 578(I)/2025, the FBR has amended the Sales Tax Rules, 2006, mandating revised formats for reporting domestic purchases and sales within the monthly Sales Tax Return.
The notification specifically directs amendments to Rule 14 of the Sales Tax Rules, 2006, focusing on the annexes attached to Form STR-7, which are used by registered businesses to declare their transaction details.
Key Changes Introduced:
- Revised Annex-A (Domestic Purchase Invoices – DPI): The existing format for reporting domestic purchases (Annex-A) has been entirely substituted. The new Annex-A requires registered persons to provide detailed information about purchases made from other registered entities. Key data points include:
- Supplier’s National Tax Number (NTN) and Name
- Document Type (e.g., invoice)
- Purchase Rate
- Quantity / Electricity Units
- Value of Purchases (excluding Sales Tax)
- Sales Tax / Federal Excise Duty (FED) in Sales Tax Mode
- Input Credit claimed
- Extra Tax
- Sales Tax / FED Withheld (if acting as a withholding agent)
- Revised Annex-C (Domestic Sales Invoices – DSI): Similarly, the format for reporting domestic sales (Annex-C) has been replaced. The updated Annex-C mandates detailed reporting of sales transactions, including:
- Buyer’s Particulars (NTN/CNIC, Name)
- Item details (HS Code/Description)
- Applicable SRO No. / Schedule reference
- Total Value of Sales
- Value on which Sales Tax / FED is charged (distinguishing between Retail Price and Fixed/Notified Value where applicable)
- Sales Tax Amount
- FED Amount
- Further Tax Amount
- Provincial Origin of Supplier/Sale
- Document details (Type, No., Date)
- Distinction for Sales under Exemption, Zero-Rating, and Reduced Rates.
- New Annex-C1 Inserted: A completely new annex, designated as Annex-C1, has been added after the revised Annex-C. Based on the column headers visible in the notification, Annex-C1 appears designed to capture details linking sales invoices with payments received. Columns include:
- Buyer’s Particulars (NTN/CNIC, Name)
- Invoice Details (Type, No., Date, Value excluding Sales Tax, Sales Tax amount)
- Payment Received details (Instrument Type, No., Date, Amount)
Legal Authority and Implications:
These amendments are made under the authority granted by the Federal Excise Act, 2005 (specifically Sections 4(1), 6(2A), and 40) and the Sales Tax Act, 1990 (Sections 50(1) read with Section 26).
The introduction of these revised and new annexes signifies the FBR’s push towards more granular data collection and enhanced monitoring of sales tax transactions. Businesses registered for sales tax must immediately take note of these changes. They will need to ensure their accounting systems, invoicing software, and internal processes are capable of capturing and reporting the required information accurately in these new formats when filing their STR-7 returns for the relevant tax periods going forward.
Failure to comply with the updated reporting requirements could lead to discrepancies during data reconciliation, potential audits, and possible penalties. Registered persons are advised to familiarize themselves thoroughly with the new Annex-A, Annex-C, and Annex-C1 formats to ensure seamless compliance.
