The Federal Board of Revenue (FBR) has announced that traders will be required to make their initial quarterly advance tax payment in October 2024, according to sources.
This new system necessitates changes to existing regulations, shifting tax payments from a monthly to a quarterly schedule. During recent discussions between the FBR and business representatives, a proposal was put forward to categorize traders based on their business types for tax collection purposes.
Traders had previously requested the option to pay taxes annually. However, the updated policy mandates that advance tax be paid quarterly, with the first installment for the period of July-September 2024 due in October.
The new system aims to streamline the tax collection process by focusing on business categories rather than conducting exhaustive door-to-door surveys, which are time-consuming. The FBR plans to establish major business categories and set fixed advance tax amounts for each category to simplify the process.
The transition will involve amending the FBR’s notification to replace the current monthly fixed tax system with the new quarterly payment structure.