16/09/2025
*The Karachi Tax Bar Association (KTBA) has once again expressed serious concerns regarding the functionality and stability of the Federal Board of Revenue’s (FBR) online return filing portal, IRIS.*
In a detailed letter to the FBR chairman, KTBA President Ali A. Rahim noted that taxpayers and professionals continue to face major hurdles in filing income tax returns for the tax year 2025. According to KTBA, the IRIS system undergoes frequent technical changes, often introducing new glitches. These issues, they said, waste valuable time, reduce efficiency, and create panic as filing deadlines approach.
“Such instability leads to repeated requests for deadline extensions. The problem is not just technical but also impacts the credibility of the return filing system,” the KTBA president emphasized. He urged FBR to work closely with tax professionals and implement lasting solutions instead of temporary fixes.
The letter highlighted several specific anomalies in the IRIS system. One major concern is that the portal does not allow proper adjustment of tax credits on donations against the surcharge payable under section 4AB of the Income Tax Ordinance. KTBA explained that, under the law, surcharge is part of a taxpayer’s overall tax liability, and therefore, donations must be allowed as a credit against it. Failure to incorporate this adjustment, the association said, results in incorrect tax calculations and violates taxpayers’ rights.
Another technical flaw, according to KTBA, is the treatment of surcharge against advance tax. At present, IRIS generates a separate payment demand for surcharge, ignoring advance tax already collected. KTBA argued that this practice amounts to double taxation, which is inconsistent with the law. They demanded immediate correction or an official clarification from FBR.
The association also objected to how the portal treats additional withholding under section 100BA of the Ordinance. KTBA argued that this amount should not be treated as minimum tax, as it was designed only to ensure compliance, not to create a permanent tax burden. According to KTBA, such treatment erodes taxpayer confidence and discourages voluntary compliance.
Electricity bills are another area of concern. KTBA noted that the law distinguishes between minimum tax and adjustable tax on electricity bills, depending on their amount. However, the current IRIS setup treats all such deductions as minimum tax, which is not aligned with legal provisions.
Finally, KTBA pointed out confusion regarding minimum tax on services under section 153. The system, they claimed, wrongly includes sales tax in the turnover figure for computation purposes, leading to an inflated tax liability.
The Karachi Tax Bar Association has requested that all these issues be addressed urgently to avoid chaos as the filing deadline approaches. They stressed that taxpayers have a constitutional right to have their liability determined strictly according to the law, and technical errors in IRIS must not override that principle.
KTBA concluded its letter by warning that if corrective measures are not taken swiftly, both taxpayers and the FBR will face unnecessary disputes, loss of trust, and a surge in litigation.
