dated 14.07.2026, regarding draft SRO Special Procedure for Small Shopkeepers

Government of Pakistan Revenue Division Federal Board of Revenue ***** Islamabad. rhe l4'h July. 2026. NOTIFICATION (lncome Tax) S.R.O. 1109 (l)12026. - The following draft Special Procedure for Small Shopkeepers which the Federal Board of Revenue proposes to prescribe under section 99B of the Income Ta,r Ordinance. 2001 (XLIX of 2001 ), is hereby published for information of all persons likely to be affected thereby and. as required by sub-section (3) ofsection 237, notice is hereby given that objections or suggestions thereon may for consideration ofthe Board be given within seven days of the publication of the draft in the official Cazette. Objections or suggestions received from any person before the expiry ofthe said period shall be taken into consideration' namely: "Draft Special Procedure for Small Shopkeepers" This special procedure shall apply to Individuals eaming income1. Applicability. - mainly through retail shops with annual tumover up to PKR 200 million. This special procedure shall apply for tax year 2026. This procedure shall not apply to2. Exclusions. - the (i) individuals whose tumover exceeded PKR 200 million in any one of preceding 3 years; those owning more than one shop; Tier-l retailers; sellers of jewellery; and providers of professional services (e.g. doctors, engineers, lawyers); and who filed a retum (ii) shop income other sources of income are excluded. Retailers for tax year 2025 may also hle a retum under this Special Procedure for small shopkeepers, provided their payable tax is not lower than in2025' and they have not split up or renamed their business to avail this special procedure. register with FBR through the IRIS web portal,3. Registration. - Shopkeepers may shopkeepers' mobile application, or by visiting the nearest tax office for assistance in registration. procedure shall remain optional and a shopkeeper may either4. Voluntary Nature. - The pay tax under this procedure or can file a regular income tax retum' be charged at the rate of 170 ofgross tumover. Shopkeepers may5. Tax Rate. - Tax shall deduct withheld income tax from their payable amount. However, if withholding tar collected exceeds the minimum tax payable under this procedure. no refund shall be issued. Procedure. - To avail this special procedure, the 6. Minimum Tax under this Speciat shopkeepers must pay a minimum of PKR 25,000 in cash along with retum of income regardless ofany tax deduction or collection at source under the Ordinance. Tax payable (less withholding) or PKR 25.000 whichever is higher shall be the tax payable.

7. Audit. - Shopkeepers opting for this special procedure shall generally not be subject to audit. Departmental proceedings may be initiated only in consultation with representatives of trade associations in case ofthird party information received by FBR about:- (a) Significant or unusual economic transactions: (b) Acquisition or ownership ofexpensive assets; and (c) Gross misuse of this special procedure to avoid taxes. prescribed return (Annex-I) on8. Return Filing. - Shopkeepers shall file a simplified IRIS web portal or through shopkeepers' mobile application. declaring total sales, total purchases. other expenses, and net profit. The same simplified form also provides an easy mechanism for shopkeepers to declare their legitimate assets. This form shall be available in Urdu and regional languages. - Shopkeepers under this special procedure shall9. Withhotding & Other Provisions. not be required to withhold tax on purchases of goods or services under section 153 of the Income Tax Ordinance. The provisions of minimum tax under section I 13 of the Ordinance and tax at the rate of 1.25%o shall also not apply. - Ifa shopkeeper neither files a regular income tax retum nor opts10. Default Surcharge. for this special procedure by the due date, penalties of PKR 10,000 on the first default, PKR 25.000 on second default. and PKR 50,000 on third default shall be imposed. There shall be a gap ofat least one month between each default proceedings. Exemption. - Eligible bona fide shopkeepers under this ll. POS or Digital Invoicing special procedure are no1 required to install a sales tax POS system or digital invoicing infrastructure. Shopkeepers opting for this special procedure shall be entitled12. Imputable Income. - to take credit of imputable income based on payment oftax in order to support their personal expenses and accretion of assets. Every bona fide shopkeeper qualifying and opting for13. Compliant Shopkeeper Plate. - this special procedure shall be issued a compliant shopkeeper plate ("Green Plate") containing thean FBR specified QR-Code, the shopkeepers' name and NTN, and the address of shopkeeper, which shall be prominently placed outside the shop. This QR-code, shall contain inlormation about location ofshop and particulars ofownership. No officer or offrcial ofFBR shall enter the shop in presence of this plate in respect oftax matters ofa bona fide shopkeeper.

Annex-l Easy Tax Return for Small Retailers (Tax Year 2025) Name: lD Card Number: Business Name: Business Address: Nature of Business (type of goods bought and sold): lncome & Tax Details Annual Sales of Goods: Annual Purchase of Goods Business Expenses Net Profit; Other Sources of lncome (if any) Total Tax: To be calculated by system lmputed lncome: To be calculated by system Tax Already Paid (Withholdi ) Tax Paid with Return: Assets (Balance Sheet) Business Capital: Non-Movable Prope Cash in Bank: Cash in Ha nd: Other Assets: TotalAssets: I certify/dectore thot the obove stotements dre true to the best of my knowledge. Signature: Oate: lF No. 1(17)R&S/20261 (Muhamma Qureshi) Secretary (Rules & SRO)