Islamabad: The Federal Board of Revenue (FBR) has removed 15,678 companies from the Active Taxpayers List (ATL) after the statutory deadline for filing income tax returns expired on December 31.
According to FBR sources, companies that failed to file their returns within the due date have now been declared inactive for tax purposes. To regain active status on the ATL, such companies will be required to pay a fixed fine of Rs. 20,000. Alternatively, they may remain inactive until the next tax year by filing their returns accordingly.
The removal from ATL has significant financial implications. Under the Income Tax regime, withholding tax (WHT) rates applicable to non-active companies are double those charged to active taxpayers. For example, where an active company is subject to 10% withholding tax, an inactive company will be charged 20% on the same transaction.
Although this excess withholding tax remains adjustable at the time of assessment, tax experts caution that it can severely impact a company’s cash flow, as higher taxes are deducted upfront during the year.
The FBR has reiterated that maintaining active status on the ATL is critical for businesses to avoid unnecessary financial strain and compliance complications.
As per the latest figures, the total number of ATL taxpayers stands at 6,949,161, comprising individuals, Associations of Persons (AOPs), and companies.
The tax authority continues to urge non-compliant taxpayers to regularize their status promptly to benefit from reduced withholding tax rates and uninterrupted business operations.
