The Federal Board of Revenue (FBR) will notify taxpayers of errors and discrepancies detected in their income tax returns by an automated system, and allow them to respond before any legal or penal proceedings begin.
The procedure was notified on Wednesday through SRO 2098 of 2026. It adds Rule 38B, “Procedure for electronic scrutiny and intimation of issues detected by the automated system,” to the Income Tax Rules 2002.
The system will cross-match information declared in returns with other data held by the tax authorities. It will flag factual errors, legal mistakes, and discrepancies in tax records.
Taxpayers will be informed through an online advisory or advance intimation sent via IRIS. The Officer of Inland Revenue with jurisdiction over the taxpayer may also issue the same system-generated intimation.
Each notice must state a response period of at least seven days. Within this period, the taxpayer may explain the issue, correct the errors, or take other remedial steps. If there is no response, the system will issue a reminder allowing at least seven more days.
Details of the detected issues, notices sent, and responses received will be shared with the responsible Officer of Inland Revenue. All notices, responses, and actions will also be recorded on the system’s dashboard for monitoring.
The officer will review the response of the taxpayer, if any, and assess the matter. The officer may then take appropriate action under the Income Tax Ordinance 2001 and the rules made under it.
