Day 9: Salaried Individuals – How to Declare Salary Income In Pakistan
Understanding Tax Deduction by Employers and Annual Salary Reconciliation
💼 Why Salary Declaration is Crucial
For salaried individuals, salary is typically the primary source of income and is subject to withholding tax by the employer under Section 149 of the Income Tax Ordinance, 2001.
Despite the employer’s deduction, the responsibility of filing a tax return still lies with the employee. Declaring this income accurately helps avoid penalties and ensures eligibility for tax refunds or credits.
🧾 Step-by-Step: Declaring Salary Income in FBR IRIS
1. Collect the Salary Certificate or Annual Tax Deduction Certificate
This document includes:
- Monthly gross salary
- Allowances and deductions
- Total income
- Income tax withheld during the year
Make sure the employer is registered with FBR and has filed withholding statements (Form 165).
2. Login to FBR IRIS
- Go to https://iris.fbr.gov.pk
- Enter your CNIC and password
- Navigate to “Declaration” > “Income Tax Return”
3. Access the Salary Section
In the return form:
- Open Employment tab under “Income”
- Enter total salary received (as per certificate)
- Confirm employer’s NTN and tax deducted at source
- Verify if tax deducted matches your certificate
4. Declare Employer Details
Provide:
- Name of Employer
- NTN of Employer
- Tax Year
- Nature of Employment (permanent, contractual, etc.)
5. Adjust Any Additional Income or Refundable Tax
- If you switched jobs, combine salaries from both employers.
- Add any bonuses, benefits-in-kind, or allowances (e.g., conveyance, medical).
- Mention tax already paid for adjustment or refund.
📊 Example Scenario
Let’s say your gross annual salary is PKR 2,000,000. Your employer deducted PKR 65,000 in tax. On IRIS:
| Field | Value |
|---|---|
| Employer NTN | 1234567-8 |
| Salary Income | 2,000,000 PKR |
| Tax Deducted (Section 149) | 65,000 PKR |
| Other Allowances | 200,000 PKR |
| Refund Claimable | As per IRIS calc. |
⚠️ Common Mistakes to Avoid
- Not declaring tax withheld if salary is under taxable limit
- Skipping the reconciliation of multiple employers
- Forgetting to enter exact withholding tax figure
- Overstating or understating allowances
💡 Tip from Experts
Use your bank statement and payslips to cross-check the actual salary received. Any mismatch may trigger an audit or create delay in refunds.
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- Reviewing employer withholding details
- Reconciling multiple jobs and allowances
- Ensuring correct refund claims
- Filing error-free FBR returns
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📧 Email Support: mtfco@onewebonehub.com
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