Understanding Income Tax Return and Tax Year
An Income Tax Return is linked to a specific tax year, which is a 12-month period ending on June 30th, corresponding to the financial year. The tax year is identified by the calendar year in which this date falls. For example, the tax year 2024 covers the period from July 1, 2023, to June 30, 2024.
What is a Special Tax Year?
A “special tax year” is a unique 12-month period that does not align with the regular tax year ending on June 30th. Instead, it can start and end on different dates, and it is identified by the calendar year in which the closing date of that period falls.
For example:
- A special tax year running from January 1, 2023, to December 31, 2023, would be denoted by the calendar year 2024 because it ends within that year.
- Similarly, a special tax year spanning from July 1, 2023, to October 14, 2024, would be denoted by the calendar year 2025.
Special tax years are often used by businesses or individuals who may have different fiscal periods due to the nature of their operations or other specific requirements. Understanding whether your financial activities align with a regular or special tax year is crucial for accurate tax filing.
Income Tax Due Dates for 2024
It’s crucial to know the deadlines for filing your income tax return to avoid penalties. Here are the key dates for 2024 in Pakistan:
- Individuals & Associations of Persons (AOP): The last date to file an income tax return is October 31, 2024. Now, The Federal Board of Revenue (FBR) has extended the income tax return 2024 last date to October 31, following requests from trade associations and Tax Bar Associations.
- Companies: The due date is December 31, 2024.
- Companies with a Special Tax Year: The return must be filed on or before September 30, 2024.
For most individuals, the key date to remember is October 14, 2024—this is the deadline to file your income tax return for the 2024 tax year in Pakistan.
Key Points to Remember:
You might wonder why you should bother with NTN verification. Think of it as a checkup for your tax ID. Verifying your NTN offers several benefits for both individuals and businesses:
- Tax Year: A 12-month period ending on June 30, identified by the calendar year in which this date occurs.
- Special Tax Year: Any 12-month period ending on a different date, identified by the relevant calendar year in which the period closes.
- Filing Deadlines: Ensure you file by the appropriate deadline based on your taxpayer classification.
