Sales Tax Registration in Pakistan

Businesses with an annual turnover exceeding PKR 10 million or those engaged in manufacturing, importing, exporting, or supplying taxable goods must register for sales tax. Additionally, service providers in sectors subject to sales tax and entities involved in the supply of taxable goods or services also need to register.

You can register for sales tax through the FBR’s online portal, IRIS. First, create a taxpayer profile in IRIS, then submit the Sales Tax Registration application. You'll need to provide documents like your National Tax Number (NTN), business details, CNIC, and proof of business location. Once the application is verified, FBR will issue a Sales Tax Registration Certificate.

Key documents include:

o National Tax Number (NTN)

o Computerized National Identity Card (CNIC) of the business owner

o Proof of business address (utility bill or rental agreement)

o Bank account details

o Business license (if applicable)

o Authorization letter if registered by a representative.

The general sales tax rate in Pakistan is 17%. However, different rates may apply to specific goods or services as outlined by the FBR. Additionally, some essential goods and services might be exempt from sales tax altogether.

Typically, it takes about 7-10 business days for the FBR to process a Sales Tax Registration application once all required documents and information are submitted correctly.

Sales tax registration provides legal recognition, allowing businesses to claim input tax credits, enabling competitive pricing, expanding market reach, and ensuring compliance with Pakistani tax laws. It also builds trust with larger clients who prefer working with registered businesses.

You can check your Sales Tax Registration status by logging into the FBR IRIS portal with your credentials. Alternatively, you may also contact the FBR’s helpline or visit an FBR office to inquire about your registration status.

Failure to register for sales tax when required can lead to penalties, including fines, surcharges, and potential legal action. The FBR may also impose a daily penalty for delayed registration, and unregistered businesses may be barred from claiming input tax credits.

Yes, businesses can apply for deregistration if they no longer meet the threshold or criteria for sales tax registration. You need to submit a deregistration request through the IRIS portal, which the FBR will review. Upon approval, you will be deregistered, and your sales tax obligations will cease accordingly.