This blog is written by Mr. M. Baser Dawer, Associate Taxation and Corporate Services. Please read this blog and provide our valued comments.


Offences and Penalties under Income Tax Ordinance 2001

Everyone should try his best to comply with laws ,rules and regulations to avoid any harsh consequences. Some of the non-compliances are of such a nature that one must pay for it. These are so significant to be mentioned as “ Offence ”. Section 182 of Income tax Ordinance,2001 specifies different type of penalties for a person who commits any offence. Some of these offences and penalties are as as follows:

Sr No. Offences Penalties
 

1

 

Where a person fails to furnish a return of Income as required u/s 114 within the due date.

0.1% of tax payable for that tax year for each day subject to maximum penalty of 50% of tax payable or twenty thousand rupees whichever is higher.
 

 

2

 

 

Where any person fails to furnish a statement as required u/s 115,165 or 165A within the due date.

Penalty of Rs.5,000 if tax has already been deposited by the due date and statement is filed within ninety days from the due date and, in all other cases Rs.2,500 for each day of default from due date subject to minimum penalty of Rs.10,000.
3 Where any person fails to furnish wealth statement or wealth reconciliation statement. 0.1% of taxable income per week or Rs.20,000 whichever is higher.
4 Where any person fails to furnish foreign assets and income statement within due date. Such person shall pay a penalty of  2% of foreign income or value of the foreign assets for each year of default.
5 Any person who fails to issue cash memo or invoice or receipt when required under the Ordinance or rules. Penalty of Rs.5,000 or 3% of amount of tax involved whichever is higher.
6 Any person who is required to apply for registration

Under the Ordinance but fails to make application for registration.

 

Such person shall pay a penalty of Rs.5,000.

7 Any person who fails to notify the changes of material nature in particulars of registration. Such person shall pay a penalty of Rs.5,000.
 

 

8

 

Any person who fails to deposit the amount of tax due or any part thereof.

Such person shall pay a penalty of 5% of the amount of tax in default .For the second default an additional penalty of 25% of the amount in of tax default.For the third and subsequent defaults an additional penalty of 50% of the amount of tax in default.
9 Any person who repeats erroneous calculations in the return for more than one year resulting in amount of tax less than actual tax payable under the Ordinance is paid.  

Such person shall pay penalty of Rs.5,000 or 3% of amount of tax involved whichever is higher.

10 Any person who fails to maintain records required under this Ordinance or rules. Such person shall pay a penalty of Rs.10,000 or 5% of the amount of tax on income whichever is higher.
 

11

Any person who denies or obstructs the access of the Commissioner or any officer authorized by the Commissioner to the premises, place, accounts, documents, computers or stocks.  

Such person shall pay a penalty of Rs.25,000 or 100% of the amount of tax involved, whichever is highier.

12 Any person who fails to collect or deduct tax as required under any provision of this ordinance or fails to pay the tax collected or deducted as required under section 160.  

Such person shall pay a penalty of Rs.25,000 or 10% of the amount of tax whichever is higher.

Baser Dawer