KTBA seeks corrected return form, formal notification from FBR

September 14, 2026 (MLN): The Federal Board of Revenue has yet to formally notify the Income Tax Return for Tax Year 2026, even as taxpayers are being asked to file through the version already uploaded on the IRIS portal, the Karachi Tax Bar Association (KTBA) said in a letter to FBR, warning that the gap between availability and formal prescription leaves the return's legal status uncertain and could expose taxpayers to disputes down the line.

In its letter dated August 10, 2026, the association reminded the FBR that the draft return was circulated through SRO 835(I)/2026 on May 7, 2026, under Section 237(3) of the Income Tax Ordinance, 2001, inviting stakeholder objections.

KTBA said it had submitted detailed representations during that consultation, but despite the process being complete, the FBR had not issued a final notification amending the Second Schedule of the Income Tax Rules, 2002 to formally prescribe the form.

Beyond the notification issue, the bar body listed a set of technical and functional problems it said its members had encountered on IRIS.

These included the refund-application facility not being enabled for Tax Year 2026, and the system's failure to generate a downloadable acknowledgement slip after filing.

KTBA also pointed to reconciliation issues in the wealth statement module including restrictions on entering brought-forward capital where no current-year business income exists, and incomplete auto-carry-forward of prior-year wealth statement fields, both of which it said create artificial mismatches.

It called for an Excel upload facility to ease bulk data entry for returns with extensive schedules.

On partnership returns, the association said IRIS does not allow filing when partners' profit-sharing percentages fail to add up to exactly 100%, and separately blocks any modification of taxpayer profiles under Section 181.

Other deficiencies cited include the absence of a facility to claim tax collected under Section 235 on domestic electricity bills; a block on revising submitted Tax Year 2026 returns despite Section 114(6) permitting revision within 60 days of filing; and non-functional fields for "Attributable Taxable Income" and the corresponding tax under the Section 148 minimum-tax regime.

KTBA further said tax auto-fetched under Section 153(1)(b) from the FBR portal often displays incorrectly, with no option to edit or delete the figure.

The association also asked that manual entry of financial-statement data be made optional where taxpayers already upload files in the electronically readable format now mandated under Sections 19DA and 114(2A), and recommended a guided questionnaire to help determine tax residency status under Sections 82 to 84.

It flagged that updating property details in the wealth statement creates duplicate entries instead of amending existing ones, and that non-resident taxpayers see incorrect unreconciled amounts because the system applies resident-taxpayer wealth-reconciliation logic to them despite non-residents not being required to file wealth statements.

It also suggested that the vehicle chassis number requirement for existing vehicles be dropped or made optional, with registration number treated as sufficient identification.

KTBA urged the FBR to issue the final notification for the Tax Year 2026 return as a matter of urgency, resolve the technical deficiencies on IRIS, and deploy a corrected version of the form.

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