ISLAMABAD (March 24 2003) : Under the guidelines of International Monetary Fund (IMF), the Central Board of Revenue (CBR) is devising a new procedure for processing of income tax returns under Self-Assessment Scheme (SAS) and speedy payment of income tax refund pertaining to overpaid taxes.
Sources told Business Recorder here on Sunday that all income tax returns are acceptable under Income Tax Ordinance 2001 and new returns filed from September 30 would be processed under the new procedure.
IMF has asked the officials to zoom in on specific areas like detection of fraudulent income tax refunds.
It would ensure rapid processing envisaged under the law for refunds of overpaid tax, and collection of information for audit selection purposes.
The procedure would deal with incomplete tax returns and assist taxpayers in completion of the returns.
The system would be devised to give priority to refund claims. Before payment of refund to the taxpayers, the department would be in a position to detect fraudulent refund claims.
Furthermore, “industry/occupation” coding would be followed for non-employee returns; audit selection and management information purposes.
Under full self-assessment arrangements, taxpayers' returns would be largely accepted on face value in the first instance and quickly computer-processed to verify the mathematical accuracy of the information provided.
It would verify the taxpayer's computation of tax liability to determine any residual amount, due or to be refunded and refund overpaid tax where applicable.
The rapid and accurate processing of returns filed assumes that the vast bulk of taxpayers' returns do not require examination by technical officials (or additional inquiries of taxpayers) prior to computer processing, although it is likely that some clerical vetting/conding will be required, IMF added.