The Federal Board of Revenue (FBR) has made amendments to ease the requirements for filing balance sheets of assets and liabilities for certain entities. Specifically, individuals, associations of persons (A.O.P), and single-member companies who are already registered have been granted relief in this regard.
In this context, the FBR issued SRO581, which relaxes the previously stringent conditions imposed on new sales tax registrations. These conditions were introduced through amendments to the sales tax registration rules of 2006 via SRO 350(I)/2024 dated April 7th, 2024, with the aim of preventing tax fraud by restricting certain activities and transactions.
One of the conditions introduced for new sales tax registrations was the mandatory filing of a balance sheet. This requirement also applied to already registered entities falling within a certain class, who were given a 30-day period to comply. However, many registered entities were unaware of this requirement, as no prior notice or information session was provided by the FBR.
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Subsequently, after the Eid holidays, when existing registered entities attempted to file their sales tax returns or Annex ‘C,’ they encountered difficulties due to non-compliance with this condition. This led to confusion and disruption in the trading community.
However, following representations from tax bars, trade bodies, and various business forums, the FBR has decided to relax this condition and remove the check from electronic filing. This move is expected to facilitate a large number of genuine businesses in filing their monthly sales tax returns.
According to Notification 581 dated April 18th, 2024, the FBR has partially relaxed the requirement for filing a balance sheet of assets and liabilities for individuals, A.O.P, and single-member companies that are already registered.
