Learn about the latest FBR penalties and restrictions for late or non‑filing of income tax returns in Pakistan for 2025. Stay compliant and avoid fines.
The Federal Board of Revenue (FBR) has made significant changes to penalties and restrictions for late filers and non‑filers through the Finance Act 2024 and Finance Act 2025. With stricter enforcement in 2025, taxpayers face higher fines, surcharges, and transaction restrictions if they fail to file their income tax returns on time.
Penalties Under Section 182 (Late Filing after Notice)
For tax year 2025, the penalty for late filing after receiving a notice is the higher of:
0.1% of tax payable per day of default or Rs 1,000 per day
Minimum Penalty:
- Rs 10,000 for individuals
- Rs 50,000 for companies and associations
Surcharge for Late Filers (ATL Inclusion)
If you file your return after the deadline, you can still be added to the Active Taxpayers List (ATL) only after paying a surcharge as per SRO‑1635(I)/2024.
- On‑time filers or those filing within the extended due date don’t have to pay this surcharge.
Higher Withholding Tax for Late Filers & Non‑Filers
Under the Finance Act 2024, Section 100BA imposes higher withholding tax rates not only on non‑filers but also on those who filed late.
Result: You lose filer benefits and pay more tax at source.
Finance Act 2025 – New Restrictions for Non‑Filers
Effective July 1, 2025, non‑filers face strict bans and restrictions:
🚫 Cannot purchase or book new motor vehicles (except ≤ 800cc)
🚫 Cannot buy property beyond notified limits
🚫 Restricted from investing in securities, mutual funds
🚫 Bank account openings and withdrawals limited (except Asaan account)
💸 Cash withdrawal withholding tax for non‑filers increased to 0.8%
Real‑Life Impact
Many taxpayers have already reported late filing fines of Rs 1,000 per day and ATL surcharges up to Rs 75,000 depending on tax payable. Non‑filers may also face higher taxes on property transfers, vehicle purchases, and banking transactions.
| Non‑Compliance | Penalty / Restriction (2025 Rules) |
|---|---|
| Late filing after notice | ≥0.1% of tax per day or ≥Rs 1,000/day; min Rs 10,000 (individual) |
| Late filing after deadline | ATL surcharge as per SRO‑1635(I)/2024 |
| Filing late → Not in ATL | Higher withholding tax rates |
| Non‑filers (Not on ATL) | Ban on property/vehicle purchases, investment, banking limits |
| Cash withdrawal by non‑filers | Withholding tax raised to 0.8% |
Tips to Avoid Penalties
✔ File your tax return before the deadline (usually 30 Sept for individuals).
✔ Keep proof of submission and tax payment challans.
✔ If you have no taxable income, file a nil return to stay on ATL.
✔ Consult a professional tax consultant for compliance.
inal Thoughts
With the Finance Act 2025, the cost of being a non‑filer has increased significantly. Filing on time helps you avoid penalties, higher taxes, and restrictions on financial transactions.
💼 Need assistance with tax filing?
📞 Contact us today:
Whatsapp or Call: +92 313 477 5085
Email: info@alilawassociates.com.pk
Address: Office No. 01, 4th Floor, Pak Heights Begum Road, Lahore, PK 05411