- The Sales Tax Act of 1990 requires registered businesses to keep detailed records on-site for a period determined by the Federal Board of Revenue (FBR)
- This record-keeping is crucial for transparency, compliance with tax laws, and facilitating auditsLegal requirements for record maintenance
- Section 22 of the Sales Tax Act, 1990 outlines the obligations for maintaining records including the type of information and the format requiredDetails of records that must be maintained1. Records of supplies made including descriptions, quantities, values, recipient details, and tax charged2. Records of goods purchased detailing descriptions, quantities, values, supplier information, and tax paid3. Documentation of all imports with descriptions, quantities, values, and taxes paid4. Separate records for zero-rated and tax-exempt supplies5. Maintenance of double-entry sales tax accounts is mandatory6. Retention of invoices, credit and debit notes, bank statements, and other relevant documents7. Electronic records must be kept for accessibility and efficiency8. The FBR may require additional records for specific purposes or business categoriesFBR’s authority
- The FBR can dictate the exclusive use of business bank accounts for transactions
- It may require the use of approved electronic fiscal cash registers and prescribe specific software for record-keeping and tax filingsAudit and compliance
- Businesses audited under the Companies Ordinance, 1984 must submit audited annual accounts to the FBR with a certificate verifying tax paymentsImportance of record maintenance
- Proper record-keeping ensures adherence to tax laws and reduces disputes during audits
- It aids the FBR in verifying tax liabilities and enhances tax administration efficiency
- Compliance with these record-keeping rules increases transparency and trust in Pakistan’s tax system
Source: pkrevenue.com
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
