07/07/2026
*There Is a Change in Pakistan's 2026 Tax Return Form That Most Salaried Employees Do Not Know About*
The Federal Board of Revenue opened income tax return filing for Tax Year 2026 on July 1, 2026.
Team taxation, accounting and finance updates want to talk to every salaried professional in Pakistan reading this.
_Not the business owners. Not the tax practitioners. You — the professional earning a salary above Rs. 600,000 a year._
Because every year, the same pattern repeats: the window opens in July, filings spike in September, and thousands of returns get blocked, delayed, or penalised because of mistakes that could have been avoided. This year, there is one additional issue that almost no one is talking about.
*🔔 The Change in SRO 835(I)/2026 That Will Catch People Off Guard*
Under SRO 835(I)/2026, FBR has introduced a mandatory requirement in the salary section of the income tax return:
_Your employer’s NTN or CNIC is now compulsory._
If you file without this number, the salary section of your return is incomplete. Before you open IRIS, ask your HR or Finance department for this information.
*Two other changes worth knowing:*
> 📌Social media income now has its own dedicated field. If you earn from YouTube, TikTok, or any digital platform, it can no longer be lumped under “other income.”
> 📌Automatic refunds are now available if you link your bank account to your FBR profile — no office visit required.
*📋 Who Is Required to File?*
Under *Section 114 of the Income Tax Ordinance, 2001*, you must file a return if any of the following apply:
> ✅Your total income exceeds Rs. 600,000 in the tax year
> ✅Your salary is Rs. 1,000,000 or more annually
> ✅You own property of 500 square yards or more
> ✅You own a vehicle with engine capacity above 1,000cc
> ✅Your monthly electricity bill exceeds 500 units
> ✅You hold foreign income or foreign assets
> ✅You were on the Active Taxpayer List last year and want to remain on it
If you meet even one of these, you are required to file. Waiting until September is not a strategy — it is a risk.
*🖥️ The 11-Step Process on IRIS*
1. Go to _*iris.fbr.gov.pk*_ — this is the only official portal.
2. Select the appropriate return form (salaried persons: Form 114(I), applicable when salary exceeds 50% of total income)
3. Fill in your salary section — including your employer’s NTN (mandatory under SRO 835 this year)
4. Add ot
her income: bank profit, rental income, dividends, freelance or digital earnings
5. Upload your *withholding tax certificates* from your employer and bank
6. Add deductions: Zakat under Section 60, charitable donations under Section 61
7. IRIS calculates your tax automatically — pay any balance via e-payment or 1-Bill
8. Complete *Form 116 — Wealth Statement* (this is where most returns fail — see below)
9. Reconcile your wealth statement until the numbers balance
10. Submit — both forms must move to “Completed Task” status
11. Download and save your *acknowledgement receipt.*
The whole process, for a salaried employee with straightforward income, takes *under an hour* the first time and under 20 minutes each subsequent year.
*⚠️The Wealth Statement — Why Most Returns Get Stuck at the Last Step*
_This is the part FBR does not explain clearly. It is the single most common reason returns fail at the final step._
Your Wealth Statement must reconcile. The formula is:
> _*Opening net worth + Income earned − Expenses incurred = Closing net worth*_
If your assets or lifestyle grew more than your declared income can account for, IRIS will block your submission. The system will not allow you to proceed until the numbers balance.
*Common mistakes that break reconciliation:*
> 📌 Forgetting to include a spouse’s or dependent child’s assets
> 📌 Valuing property at DC rates instead of FBR’s notified valuation table
> 📌 Not declaring cash in hand or jewelry
> 📌 Missing a vehicle acquired during the year
_Fix the numbers until they reconcile. Only then will IRIS allow submission._
*💸 What Happens If You Miss September 30?*
Under *Section 182 of the ITO* , the penalty for late filing includes:
> ⚠️0.1% of tax payable per day of default, up to 50% of total tax payable
> ⚠️Minimum penalty of Rs. 40,000 — even if you owe zero tax
_Exception: If 75%+ of your income is salary and annual salary is below Rs. 5 million, minimum reduces to Rs. 5,000_
A missing *Wealth Statement* carries an additional penalty of 0 *.1% of taxable income per week* , or *Rs. 100,000* — whichever is higher.
But the larger cost is invisible.
_When you fall off the Active Taxpayer List, your withholding tax rates increase for an entire year._ Bank profit WHT rises from *20%* to *40%* . Transaction rates on property and vehicles increase significantly. And under *Section 114C* — which takes full effect from July 1, 2026 — non-filers face hard restrictions on purchasing vehicles above *Rs. 7 million* and acquiring property above *Rs. 100 million* .
*✅ File in July/August Not in September.*
The window is open. The portal is live. If your income is primarily from salary, you can complete this process yourself — for free, without an agent, without a consultant.
*_The professionals who file early avoid the rush, avoid the errors that come with the rush, and preserve their ATL status without anxiety._*
*The September deadline is real. The penalties are real. The ATL consequences last an entire year.*
*File now.*
VoxLegis Law ✍️⚖️
