The Karachi Tax Bar Association (KTBA) has called for immediate remedial measures from the Federal Board of Revenue (FBR) over legal, operational and technical difficulties affecting the filing of Tax Year 2026 income tax returns through the IRIS portal. In a five-page letter addressed to the tax authority, the association said that several issues previously brought to the FBR’s attention remain unresolved and are creating difficulties for taxpayers and tax professionals as the statutory filing deadline approaches. The letter refers to earlier representations submitted on May 19 and August 10, 2026, concerning the online return form deployed on IRIS.
According to the KTBA, the timing of the final return form has also created difficulties for taxpayers seeking to complete their filings accurately. The draft Income Tax Return for Tax Year 2026 was circulated through SRO 835(I)/2026 on May 7, 2026 under section 237(3) of the Income Tax Ordinance, 2001. The final return form was subsequently notified through SRO 1495(I)/2026 on September 2, 2026. The association said that a reading of Chapter VIII of the Income Tax Rules, 2002 indicates the importance of providing taxpayers with a reasonable and effective period to compile, verify and submit complete returns. It argued that the relatively short period between notification of the final form and the filing deadline has placed additional pressure on taxpayers.
The KTBA also highlighted recurring downtime and slow response times on the IRIS portal. The association said its members have reported disruptions during peak filing periods as well as on weekly holidays, when taxpayers and tax professionals are attempting to complete outstanding returns. According to the letter, portal instability can prevent timely submissions and may also affect taxpayers’ ability to enter and verify information correctly. The association has therefore urged the FBR to ensure stable and uninterrupted operation of IRIS throughout the filing period and provide taxpayers with an effective opportunity to meet their statutory filing obligations.
Another major concern raised by the association relates to the amount of information required through the Tax Year 2026 return. The KTBA said taxpayers are being asked to provide extensive details covering complete vehicle fleets, immovable properties, bank accounts, shareholders and partners in associations of persons. For medium-sized and large corporate taxpayers, the association said compiling information about hundreds of vehicles, numerous properties and large shareholder bases can become a substantial compliance exercise. It added that the information often has to be reconciled with third-party records and previously declared assets, making the process more time-consuming.
The timing of these requirements has been described by the KTBA as particularly difficult for large and corporate taxpayers. The association noted that returns for these taxpayers were not made available on the portal until August 27, 2026, while the final return form was notified on September 2. According to the letter, this left a limited period for taxpayers to compile, verify and enter the required information. The KTBA has asked the FBR to review and rationalise disclosure requirements and introduce system integration or bulk-upload facilities wherever practicable.
The letter also identifies several technical and functional deficiencies within the current IRIS return form. One concern involves the calculation of additional normal tax liability for taxpayers falling under the minimum tax regime under section 153 of the Income Tax Ordinance, 2001. The KTBA said the matter was previously raised with the FBR through its September 16, 2026 letter but remains unresolved. The association said the current system configuration prevents affected taxpayers from making what it considers a correct declaration in their returns.
The KTBA has also objected to an IRIS restriction that limits the adjustment of prior years’ tax refunds against current tax liabilities to Rs200,000. According to the association, the Income Tax Ordinance does not appear to prescribe a corresponding monetary ceiling. It has asked that where underlying tax payments or deductions can be verified through FBR or Management Information System records, the system should allow taxpayers to adjust the full verified refund amount.
Another issue highlighted in the letter is the reported unavailability of the refund application functionality for Tax Year 2026. The KTBA has requested immediate activation of the facility, arguing that taxpayers should be able to exercise their statutory rights relating to refunds. The association has also called for the restoration of a downloadable filing acknowledgement after successful submission. It said a printable acknowledgement is important evidence that a return was filed within the required period and should therefore be available as a standard feature of the system.
The association further raised concerns over the format in which companies can submit financial statements through IRIS. It referred to section 114(2A) of the Income Tax Ordinance, which requires companies for Tax Year 2026 onwards to file accompanying financial statements in an electronically readable format. The KTBA said that while the legal definition includes structured formats such as CSV and XLSX, it understands that IRIS is currently accepting CSV files but not XLSX files. The association has asked the FBR to address what it considers an inconsistency and has also questioned the need for taxpayers to manually enter financial information that has already been submitted through an electronic file.
The letter also covers difficulties faced by taxpayers operating under transitional or special tax years. According to the KTBA, some taxpayers whose changes from the normal tax year to a special tax year have been approved by Commissioners are currently unable to access the relevant return on IRIS. The association said affected cases have been raised individually but urged the FBR to identify and correct any systemic problem preventing approved transitional or special tax year returns from becoming accessible.
The inability to enter negative figures is another technical issue identified by the tax bar. The association said IRIS currently does not accept negative figures for retained earnings, including accumulated losses, in financial statements and related schedules. It argued that this prevents taxpayers from accurately reflecting their financial position and requested that the functionality be corrected to allow reporting of losses and other negative balances.
The KTBA has also questioned the mandatory disclosure of detailed shareholder information. According to the association, submission of the return is currently conditional upon completing shareholder particulars, creating difficulties particularly for listed companies with large and frequently changing shareholder bases. The association said individual entry of such information can be operationally impracticable and suggested system-based integration or bulk-upload facilities where shareholder information is already available through regulatory or other verifiable records.
While raising the concerns, the KTBA said it supports the FBR’s objective of advancing digital tax administration and improving taxpayer disclosures. However, it said effective implementation requires filing requirements to be legally sustainable, proportionate and technically reliable, with taxpayers receiving adequate notice and a reasonable opportunity to comply.
The association has requested three broad areas of immediate action from the FBR. These include ensuring stable and uninterrupted operation of IRIS, reviewing and rationalising data and disclosure requirements with integration or bulk-upload options where possible, and prioritising the correction of computation, validation, acknowledgement, refund and reporting deficiencies identified in the letter.
The KTBA said prompt action is necessary because the reported issues could contribute to failed submissions, inaccurate declarations, potential penal consequences and difficulties in exercising statutory rights. The association has requested an early response from the FBR and said it remains available for a meeting or consultation with the Board to discuss the concerns and possible corrective measures.
The letter was signed by KTBA President Muhammad Mehmood Bikiya and Honorary General Secretary Shams Mohiuddin Ansari. Copies were also sent to FBR Chairman Rashid Mahmood Langrial, Member Inland Revenue Policy Dr. Sajjad Taslim Azam, Member Legal-IR Shad Muhammad, Pakistan Revenue Automation (Pvt) Limited Chief Revenue Domain Officer Zain-Ul-Abidin Sahi, and Pakistan Tax Bar Association President Sheikh Ahsan ul Haq.
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