Declare property values or risk penalties, FBR warns taxpayers

The Federal Board of Revenue has introduced a new requirement for taxpayers to declare the market value of their assets in their income tax returns. This move is aimed at curbing the underreporting of property values, a significant issue in Pakistan’s tax system.

The FBR clarified that no new Statutory Regulatory Order has been issued to amend the 2025 tax return form. The requirement to declare property values was included when the form was first published on July 7, 2025.

Taxpayers who have already filed their returns will not need to amend or refile them. However, for future filings, property owners must disclose the annual increase in the market value of their assets.

A common question raised by taxpayers has been whether this new rule will affect their tax calculations. According to the FBR, for most taxpayers, declaring the market value of their assets will not impact the amount of tax owed.

The tax authority has also reassured taxpayers that no penalties or notices will be issued for errors in reporting property values. The goal is to ensure that the values declared are as close to the actual market rates as possible.

The FBR also addressed some misinformation circulating on social media. They made it clear that the declaration of asset market values is entirely voluntary for most taxpayers and will not be used for tax assessments or to reconcile wealth statements. This requirement will only apply to high-net-worth individuals already covered under Section 7E of the tax code.

Don’t wait: File before September 30

While this new rule may seem complicated at first glance, the FBR has made it clear that the process is straightforward and will not disrupt tax filings for the majority of people. Taxpayers are encouraged to submit their returns well before the September 30, 2025 deadline to avoid any last-minute rush.

With the online tax filing system fully functional, the FBR is confident that taxpayers will be able to comply with the new requirement smoothly.