A.   BACKGROUND

1.   This refers to the Important in trail, blue, italic and after double line (a) 3214 of 24.7.25 about Quarterly Statement for IT WHT, Specific Extension & Expected General Extension (b) 3213 of 23.7.25 about Extension in Filing of Quarterly and Annual Withholding Statements for TY 2025 (c) 3207 of 20.7.25 about IRIS issues & KTBA Extension request FST return filing and KCV

2.   We also refer to several Other TLQC including (a) 1860 of 20.9.22 about Annual WHT Statement & Reconciliations and KC Recommendation (b) 1855 of 14.4.22 about Quarterly Withholding Taxes Statement due by 20.4.22 (c) 1690 of 18.10.21 about Quarterly Withholding Taxes Statement due by 20.10.21

B.   EXECUTIVE SUMMARY

1.   Considering the details infra, we reiterate our earlier recommendation for preparation of Reconciliation on a Monthly basis and if not possible then on Quarterly basis internally; as preparation of the same on an Annual basis at a later stage will be cumbersome exercise.

2.   We also recommend to all Tax Heads, Treasury heads & those working on Withholding Income Tax to attend the Withholding Tax Workshop on. Click here for Flyer and Register Now for Tentative Registration.

3.   We hope that your office would have submitted the Annual WHT statement or will shortly submit the same by 31.7.25, unless would apply for OR got Specific extension for your Entity as per para E, assuming General Extension is not granted considering TQLC 2313 of 23.7.25 matter in trail.

4.   For more details Section 165 extract, please refer to para C to G.

C.   ANNUAL SALARY & OTHER THAN SALARY STATEMENTS

1.   Pursuant to Section 165(6), every person deducting tax from payment under section 149 shall furnish to the Commissioner an annual statement in the prescribed form and manner. As per Rule 44(5) in the Annual Salary Statement is required to be filed by the 31st July after the end of the Financial Year.

2.   Pursuant to Section 165(7), every prescribed person collecting tax under Division II of Part V, Chapter XII or the Tenth Schedule or deducting tax from a payment under Division III of, Chapter XII or the Tenth Schedule shall, e-file to the Commissioner an annual statement for the relevant tax year within 30 days of the end of tax year in addition to statement to be filed under Section 165(6).

3.   As per Section 165(8) Every prescribed person collecting tax under Division II of this Part or Chapter XII, the Tenth Schedule or deducting tax from a payment under Division III of this Part, Chapter XII or the Tenth Schedule shall also e-file to the Commissioner a  statement in  the  prescribed form reconciling the  amounts mentioned in annual statement filed under sub-section (7) with the amounts declared in the return, audited accounts or financial statements by the due date of filing of return of income as provided under section 118 of the Ordinance.

D.   ANNUAL WHT RECONCILIATIONS AND KC RECOMMENDATION

1.   As you are aware, pursuant to Rule 44(4), a person required to furnish the statement under Rule 44(2) shall, wherever required by the Commissioner, furnish a Reconciliation of the Amounts mentioned in the aforesaid biannual statements with the amounts mentioned in the return of Income, Statements, Related Annexes and other documents submitted from time to time.

2.   Having stated above in para 3.1, the Finance Act 2021 introduced sub-section (8) to Section 165 whereby every Prescribed Person collecting Tax under Division II of Part V or Chapter XII, the Tenth Schedule or deducting Tax from a payment under Division III of Part V, Chapter XII or the Tenth Schedule shall also e-file to the Commissioner a Statement in the prescribed Form reconciling the Amounts mentioned in Annual Statement filed under Section 165(7) with the amounts declared in the Return, Audited Accounts or Financial Statements by the Due Date of Return Filing of Income as provided under Section 118 of the IT Ordinance. However, it is appropriate to internally produced Quarterly Reconciliations to help out in Annual Reconciliations.

E.   SPECIFIC EXTENSION IN FILING QUARTERLY STATEMENT

Pursuant to Section 165(4), a person required to furnish a statement under sub-section (1) may apply to the Commissioner for an extension of time to furnish the statement after the due date. The Commissioner if satisfied that a reasonable cause exists for non-furnishing of the statement by the due date may, by an order in writing, grant the applicant an extension of time to furnish the statement.

F.   SECTION 165 - UPDATED VERSION

165.   Statements.— (1) Every person collecting tax under Division II of this Part or Chapter XII or the Tenth Schedule or deducting tax from a payment under Division III of this Part or Chapter XII or the Tenth Schedule shall, furnish to the Commissioner a quarterly statement in the prescribed form setting out—

(a)  the name, Computerized National Identity Card Number, National Tax Number and address of each person from whom tax has been collected under Division II of this Part or Chapter XII or the Tenth Schedule or to whom payments have been made from which tax has been deducted under Division III of this Part or Chapter XII or the Tenth Schedule in each quarter

(b)   the total amount of payments made to a person from which tax has been deducted under Division III of this Part or Chapter XII or the Tenth Schedule in each quarter

(c)   the total amount of tax collected from a person under Division II of this Part or Chapter XII or the Tenth Schedule or deducted from payments made to a person under Division III of this Part or Chapter XII or the Tenth Schedule in each quarter; and

(d)   such other particulars as may be prescribed Provided that every person as provided in sub-section (1) shall be required to file withholding statement even where no withholding tax is collected or deducted during the period “Provided further that this section shall not apply where information required under sub-section (1) has been furnished under section 165A.”;

Explanation.— For the removal of doubt, it is clarified that this sub- section overrides all conflicting provisions contained in the Protection of Economic Reforms Act, 1992 (XII of 1992), the Banking Companies Ordinance, 1962 (LVII of 1962), the Foreign Exchange Regulation Act, 1947 (VII of 1947) and the regulations made under the State Bank of Pakistan Act, 1956 (XXXIII of 1956), if any, on the subject, in so far as divulgence of information under section 165 is concerned.

(1A) Every person involved or engaged in economic transactions as prescribed by the Board shall furnish to the Commissioner a quarterly statement in the prescribed form and manner. ”;and

(2) Every prescribed person collecting tax under Division II of this Part or Chapter XII or the Tenth Schedule or deducting tax under Division III of this Part of Chapter XII or the Tenth Schedule shall furnish statements under sub- section (l) or (1A) as per the following schedule, namely:-

(a) in respect of quarter ending on the 31st day of March, on or before the 20th day of April;

(b) in respect of quarter year ending on the 30th day of June, on or before the 20th day of July;

(c) in respect of quarter ending on the 30th day of September, on or before the 20th day of October; and

(d) in respect of quarter ending on or before the 31st day of December, on or before the 20th day of January.

(2A) Any person who, having furnished statement under sub-section (1) or sub-section (2), discovers any omission or wrong statement therein, may file a revised statement within sixty days of filing of statement under sub-section (1) or sub-section (2), as the case may be.

(2B) Notwithstanding anything contained in this section, the Commissioner as he deems lit may by notice in writing require any person, collecting or deducting tax under this Ordinance, to furnish a statement for any period specified in the notice within such period of time as may be specified in the notice.

(3)  Board may prescribe a statement requiring any person to furnish information in respect of any transactions in the prescribed form and verified in the prescribed manner

(4)   A person required to furnish a statement under sub-section (1), may apply in writing, to the Commissioner for an extension of time to furnish the statement after the due date and the Commissioner if satisfied that a reasonable cause exists for non-furnishing of the statement by the due date may, by an order in writing, grant the applicant an extension of time to furnish the statement.

(5) The Board may make rules relating to electronic furnishing of statements under this section including,-

(a)     mandatory electronic filing of statements; and

(b)     determination of eligibility of the data of such statements and e- intermediaries, etc.

(6)   Every person deducting tax from payment under section 149 shall furnish to the Commissioner an annual statement in the prescribed form and manner

(7) Every prescribed person collecting tax under Division II of this Part, Chapter XII or the Tenth Schedule or deducting tax from a payment under Division III of this Part, Chapter XII or the Tenth Schedule shall, e-file to the Commissioner an annual statement for the relevant tax year within thirty days of the end of tax year in addition to statement to be filed under sub-section (6) of this section.

(8) Every prescribed person collecting tax under Division II of this Part or Chapter XII, the Tenth Schedule or deducting tax from a payment under Division III of this Part, Chapter XII or the Tenth Schedule shall also e-file to the Commissioner a  statement in  the  prescribed form reconciling the  amounts mentioned in annual statement filed under sub-section (7) with the amounts declared in the return, audited accounts or financial statements by the due date of filing of return of income as provided under section 118 of the Ordinance.

G.   FURTHER DETAILS & SERVICES

Should you require any clarification or explanations in respect of the above or otherwise, or require Income Tax, Federal & Provincial Sales Tax or Withholding Tax Statement, Advisory, Return Filing or Review services, please feel free to email Mr Amsal at amsal@kasbati.co with CC to info.kasbati@professional-excellence.com, asif.s.kasbati@professional-excellence.com.

Best regards for Here & Hereafter
Asif S Kasbati (FCA, FCMA & LLB)

Managing Partner 

Kasbati & Co (1400+ Tax, Levies, Companies, Economy, Inflation, HR, Banking, Finance, etc

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