How to Register with the Punjab Revenue Authority for Sales Tax (PRA)
For quite some time, the government has been working to improve business accountability and to repair Pakistan's broken taxation system. Several steps have been taken to tighten the tax net and encourage more people to file taxes with the government. In Pakistan, as in the rest of the world, a variety of taxes are levied. The Punjab Revenue Authority (PRA) is a government agency in charge of collecting and managing sales tax on services. Any business or individual who provides services in a variety of sectors is subject to sales tax on services.
What exactly is Sales Tax on Services?
To generate revenue, the government collects taxes through a variety of channels. When properly collected and managed, tax revenue can be invested by the government for national development.
Sales tax on services is a type of taxation that applies to businesses and individuals in the service industry. Every country has its own sales tax regulations for services. This tax is levied on almost all service providers in Pakistan. The Pakistani government has established a standard sales tax on services of 17%.
Who Must Pay Sales Tax on Services in Pakistan?
The government has provided clear guidelines for determining who is eligible for sales tax on services registration. Anyone who provides taxable services is required by law to register with the PRA. Parties that offer more than one taxable service must only apply for one registration. Parties providing multiple taxable services must list all services provided in their application and provide certificates of registration.
Parties providing taxable services in more than one province must register separately (in the case of Punjab, with the PRA) and pay tax on services rendered in Punjab. All registered parties must include their registration number on all bills, invoices, vouchers, and other similar documents they generate.
As the country's accountability situation improves, it is recommended that everyone who is required to pay taxes register as soon as possible. Failure to do so may land you in hot water with the authorities.
If you work in any of the above-mentioned service sectors, you are required to pay a 17% sales tax on services to the government. Keep in mind that the government may change the sectors to which sales tax applies at any time.
In Pakistan, registering for Sales Tax on Services
You must first register with the PRA in order to pay sales tax on services. Because of digitization, this has become quite simple. After registering with the PRA, you can monitor and manage your tax payments through the PRA's online portal.
You will need the following documents to register for sales tax:
- Form PST 01
- Personal or corporate NTN (if applicable)
- Personal CNIC or CNIC of company partners (if applicable)
- Email and mobile phone numbers
- Form C is required for partnership firm registration.
- Private limited companies must be registered using Form II.
- For the registration of partnership firms, a partnership deed is required.
- Private limited companies must be registered with an incorporation certificate, an AOA, and a Memorandum of Association.
- Copy of paid electricity bill Copy of tenancy agreement and the owner of the business premises' CNIC
A bank maintenance certificate
Once you have all of the necessary documents, you can begin the registration process.
The Sign-Up Procedure
1) Navigate to the PRA registration portal and, if you already have an NTN, select "e-registration." After that, select "new e-registration with NTN."
2) You will now be asked to enter your NTN (if you are registering as a new AOP company) or CNIC (if you are registering as a new individual).
a) Enter the necessary information and click OK.
b) After entering your information, you will be directed to a form that contains all of your information stored with the FBR.
c) If your registered NTN number is not recognised, you should: I double-check your entry; and ii) send an email to esupport@pra.punjab.gov.pk to have your NTN manually entered into PRA's database.
The email should be formatted as follows:
- Subject: Insert NTN into database - NTN number - Company name - Service sector category
iii) If you do not already have an NTN number, you must first go to the FBR website and register for one.
3) After entering your NTN/CNIC, you will be asked to complete the registration form and provide information about your representative.
4) AOP companies will also be required to provide information about their shareholders/directors.
5) Following that, provide information about your company.
6) Enter your bank account information now.
7) Your application is now finished, and you can have it printed and submitted.
The PRA will process your application after you have submitted it along with all of your supporting documents. Following acceptance, you will receive a passcode and activation instructions via email and SMS. Finally, the PRA will assign you a PNTN, and your registration will be complete.
Remember that the PRA may request additional documentation if it deems it necessary. Furthermore, the PRA has the authority to reject a registration application for a valid reason. In this case, the authority will provide the reason(s) for the rejection within 30 days of the date the completed application was submitted to the authority.
The online portal simplifies the registration process by eliminating the need to visit PRA's offices multiple times. If you no longer provide a taxable service, you must de-register as well. The PRA's notification on sales tax on services contains information on the registration and de-registration processes.